Price and market trends: Well-supplied Germany may hold ethanol prices in check

Recent additions to Germany’s production in the traditional ethanol market have boosted competition which has led to flat or slightly softer prices in some contract negotiations for the third quarter, market sources said on 29 June.

Other contract discussions are not completed, meaning quarterly prices are yet to be assessed for beverage and industrial grade ethanol in Germany.

Previously, France and Germany values have been very similar. Extra capacity may have shifted this for fermented grade ethanol.

Cargill started selling from its Barby, Saxony-Anhalt plant earlier in 2016 while 2015 saw CropEnergies convert 60,000 cubic metres (cbm) of fuel ethanol capacity to beverage and industrial grades.

Comments from market players so far suggests some contracts in Germany have been done flat with the current ICIS price ranges, of €62-68/hl FD Germany for beverage grade.

In one instance, a producer said it had done business €1/hl below this range however it is too soon to say whether this is widespread. Market feedback in previous weeks from one other source has also been at the top of the range, similarly it is unclear whether this is where the majority of price levels are.