Minnesota:The train carrying Ethanol in the Minnesota region of the US derailed on Thursday morning, causing several coaches to catch fire and forcing nearby residents to evacuate their homes as a precaution. According to a Burlington Northern Santa Fe (BNSF) Railway statement of the US, more than 20 coaches derailed, damaging the product and catching fire for 14 hours. The government authorities will take care of health issues and other inconveniences caused by accidents. According to giant players of Ethanol and its derivatives, the product prices will incline after the incident as the demand-supply gap will widen, leading to a supply shortage.

Ethanol prices in the US market continued to move northwards owing to the stable demand for the product from Ethanol blended Biofuel producing units. Earlier, stockpile availability in the country was slightly tight and now will continue to do the same in Q2 of 2023, giving another reason for the increment in the prices of Ethanol. Towards the end of the third month of 2023, the Ethanol prices ranged between USD 760 to 820 per MT, FOB Texas. Last week also, Ethanol production in the US increased marginally, impacting the overall market dynamics of the product in the North American region.

According to the US Environmental Protection Agency, the mixed Production is due to demand uncertainty caused by relatively high gasoline prices as the Ethanol industry pushes for year-round E15 access. However, the accident that occurred recently in the Minnesota region may create a pause in the operational rate accompanying the existing challenges faced by the US chemical industries after the financial bank crisis.

As per ChemAnalyst, a major loss has occurred in the US market regarding Ethanol and its derivatives as the government was already focusing on completing the E15 target for the betterment of the domestic economy and reducing its dependency on petroleum-based products. Ethanol prices are anticipated to increase in the upcoming weeks due to a tight supply chain and stable demand for the product from the domestic and international markets.