Brazil hydrous ethanol keeps falling on supply

Marianela Toledo

19-Apr-2016

HOUSTON (ICIS)–Hydrous ethanol prices at plants in the state of São Paulo, Brazil, have fallen 30% since the beginning of the second half of March, the Centre for Advanced Applied Economics (CEPEA) said on Tuesday.

Prices for Brazil hydrous ethanol for 11-15 April reached an average of Brazilian reais (R)1.369/litre ($1.439/gal), a drop of 4.4% compared with the previous week, according to CEPEA. Taxes are not included in these figures.

The beginning of the harvest and improved product offerings in a soft demand scenario are the reasons attributed for the successive decreases, CEPEA said. The price decreases have reached the retail pumps, but not enough to make ethanol competitive on average with gasoline prices in the state.

According to the National Petroleum Agency (ANP), the average retail price of hydrous ethanol in São Paulo corresponded to 73.6% of fossil fuel during the week of 10-16 March.

The sugarcane harvest in the centre-south, which accounts for 90% of Brazil’s ethanol production, runs from April to November/December.

Brazil also produces ethanol in the northeast region. The sugarcane harvest in that area runs from September to March.

($1 = R3.60)

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