Valero saw strong US ethanol demand destruction, but sees rebound in future

Alex Snodgrass


HOUSTON (ICIS)–US ethanol and refined products producer Valero said in an investor call that the US ethanol industry saw significant demand destruction, with run cuts across the industry.

The company revealed that it has eight plants shut down and six still running, so they are running below 50% of total capacity.

The company also said that they expect the industry to normalise in the future, stating, “Domestically, we will get going again, and ethanol will be in the gasoline pool.”

It said that global renewable mandates will aid in increasing export markets, another bright spot for the downtrodden industry.

US fuel ethanol consistently faces oversupply, so opening up more export markets would aid an industry plagued by low margins and weak demand due to the coronavirus.


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