ICIS’ coverage of the Ethanol market is published weekly in Asia, Europe, Latin America. Price assessments cover anhydrous and hydrous grades in some regions, beverage and industrial grades in others.
Our market intelligence gathered by our locally based experts gives unbiased and independent commentary to support you making key commercial choices. In addition, there is Fuel Ethanol coverage in Europe giving weekly prices, news and analysis.
Updated to Q4 2019
Supply of anhydrous fuel-grade ethanol increased due to healthy corn supplies. Hydrous ethanol supply from the US to major export markets still flowed, but shipments to China dried up due to high import tariffs and some efforts to clamp down on the imports of US cargoes via transshipment hubs in southeast Asia.
Demand decreased as the Philippines, the main export destination for US fuel-grade ethanol in southeast Asia, increased requirements for blenders to purchase locally-produced ethanol under a quota system before they can import any material. The US-China trade war also dampened buying sentiment and reduced trade flows further.
Beverage 96% and industrial 99% ethanol supply tightened in the final quarter of 2019 as some volumes were siphoned off into the fuel ethanol market and the sugar been harvest was delayed. Imports were also more difficult to secure. Although these came through in similar volumes to last year, a tighter market was more sensitive to delays in deliveries.
Demand was steady in the last quarter of 2019 for traditional 99% industrial and 96% beverage ethanol markets. Some small pockets saw lower year on year demand in the chemical markets, but these were minimal and had no impact given tighter supply conditions.
Brazilian ethanol supply has grown in the fourth quarter with the harvest season for sugar cane in full swing, particularly for the centre-south region of the country. But even with the current growth, there is a chance that ethanol markets may find themselves undersupplied during the off-season, requiring imports. Production of hydrous ethanol has been at more than 2bn litres/month in the centre-south region, with sales rising more than 3% monthly.
Demand for hydrous ethanol has skyrocketed in the fourth quarter because in a price comparison, consumption of hydrous ethanol presents advantages over gasoline. Hydrous ethanol is used as a stand-alone fuel in flexible-fuel vehicles (FFVs), competing directly with gasoline. Anhydrous ethanol is blended in gasoline at a mandated 27%. With demand outpacing supply, market players predict ethanol shortages during the off-season.
US supply of fuel ethanol and industrial ethanol fell in the fourth quarter of 2019 as some ethanol plants began idling amid political and economic turmoil in the industry. Supply also fell slightly on bad corn planting in the US and flood damage that persisted in the industry through 2019.
US demand for fuel ethanol fell in the fourth quarter of 2019 as summer driving ended and the winter season was in full swing and gasoline demand declined. A narrow spread between ethanol and gasoline prices also pressured demand in the quarter.
We offer the following regional Ethanol analysis and news coverage to keep you informed of factors and developments affecting prices in the Ethanol marketplace.
News & analysis
ICIS price assessments are based on information gathered from a wide cross-section of the market, comprising consumers, producers, traders and distributors from more than 250 reporters world-wide. Confirmed deals, verified by both buyer and seller, provide the foundation of our price assessments.
Our in-depth market knowledge drives our specialist focus, as we recognise the importance of individual market dynamics and not a one-size-fits-all approach.
Over 25 years of reporting on key chemicals markets, including Ethanol, has brought global recognition of our methodology as being unbiased, authoritative and rigorous in preserving our editorial integrity. Our global network of reporters in Houston, London, Singapore, Shanghai, Guangzhou, Mumbai, Perth and Moscow ensures unrivalled coverage of established and emerging markets.
There are two main types of ethanol – fermentation and synthetic. The major outlets for industrial ethanol are as a solvent and in chemical synthesis.
Ethanol is a colourless, flammable volatile liquid, with characteristic odour and burning taste. It is miscible with water, ether, acetone, benzene and a wide range of organic products. Ethanol vapour mixes well with air, and explosive mixtures are easily formed.
The two major outlets for industrial ethanol are as a solvent and in chemical synthesis.
Ethanol is used as a chemical intermediate for the manufacture of ethyl acetate, ethyl acrylate, acetic acid, glycol ethers and ethylamines as well as other products. It is also used as an additive to food and beverages.
A large outlet for ethanol is as a fuel, oxygenate additive to gasoline and a gasoline extender.
In addition, ethanol can be used in perfume due to its light odour and quick evaporation.
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