For the Quarter Ending September 2024
North America
In the North American region during Q3 2024, the Ethanol market experienced a significant decline in prices. This downward trend was primarily influenced by a combination of factors such as surplus production capacity, and inventory adjustments by producers.
Seasonal slowdowns in demand for ethanol-blended fuels and a temporary dip in industrial consumption further exacerbated the situation. Corn prices, a key input for ethanol production, decreased, lowering production costs and facilitating lower selling prices. These elements led to an oversupply of Ethanol in the market, resulting in decreased prices. Additionally, reduced industrial demand and lower blending activity further contributed to the negative pricing environment.
Specifically in the USA, which saw the most notable price changes, the overall trend for Ethanol prices in Q3 2024 was characterized by a consistent decrease. Furthermore, the quarter-on-quarter change of 4% indicated a gradual decrease in prices. The price variation between the first and second half of the quarter, with a decrease of 7%, demonstrated a continued downward trajectory. Ultimately, the quarter-ending price of USD 535/MT of Ethanol 99% FD Houston in the USA reflected the prevailing negative pricing sentiment and the challenging market conditions for Ethanol producers.
APAC
In Q3 2024, ethanol prices in the APAC region exhibited overall stability, driven by various factors. In China, prices experienced a slight increase, supported by stable demand and supply constraints. At the start of the quarter, rising blending mandates and consistent production levels in downstream sectors such as chemicals and pharmaceuticals bolstered ethanol demand. Although domestic production remained steady, unexpected plant shutdowns and technical issues temporarily limited supply, contributing to upward price pressure. Fluctuations in raw material costs, particularly for corn, also affected production expenses. As the quarter progressed, price stability was maintained due to a seasonal uptick in demand for ethanol-blended fuels and effective inventory replenishment. The government's strict blending mandates reinforced the demand for ethanol as a renewable fuel source. By late Q3, China's ethanol market demonstrated resilience, effectively navigating internal production challenges and external economic pressures to ensure consistent pricing. Overall, the quarter-on-quarter change remained unchanged, with prices increasing slightly by 1% compared to the first half of the quarter. The quarter-ending price for ethanol Ex-Shanghai stood at USD 727/MT, highlighting the overall stable pricing environment.
Europe
In Q3 2024, ethanol prices in the European region faced a significant downturn, driven by a combination of factors. Increased domestic production, bolstered by enhanced plant efficiencies, led to a market surplus. Concurrently, imports surged from Poland, France, and Belgium, further saturating supply in Germany. Seasonal demand fluctuations played a crucial role, as reduced consumption from sectors such as chemicals and pharmaceuticals added to the downward pressure on prices. The economic landscape also shifted, with Germany experiencing a GDP contraction of 0.1% in Q2, impacting overall demand. The USDA projected an increase in U.S. corn supplies for 2024-2025; however, reduced foreign production in the EU and Russia raised concerns about potential ethanol supply challenges. These factors collectively contributed to a bearish market sentiment, resulting in lower ethanol prices across the region. Freight charges in Europe were another critical influence on the market. Rates from Asia to Northern Europe declined by 2%, while the Asia-Mediterranean route saw a 3% drop. This decrease stemmed from improved carrier capacity and a shift away from peak season demand. However, persistent congestion at major Asian ports and delays caused by incidents like the explosion at the Port of Ningbo complicated shipping schedules. Overall, the quarter-on-quarter change recorded an increase of 3%, but a price comparison between the first and second halves of the quarter showed a decline of 6%, emphasizing the overall negative pricing trends. The quarter-ending price for ethanol FD Frankfurt stood at USD 730/MT.
South America
In Q3 2024, the South American region experienced mixed Ethanol pricing environment, with significant factors influencing market prices. In the first half of Q3 2024, Brazil experienced a notable increase in ethanol prices, driven by robust domestic demand and production constraints. The government's raised blending mandate spurred demand, while technical issues and maintenance shutdowns at ethanol facilities limited supply. Additionally, adverse weather conditions delayed sugarcane harvesting, impacting production levels. As a result, ethanol production surged up to 21% from the previous year, yet tight supply dynamics led to reliance on spot purchases, further elevating prices. During the second half of Q3 2024, ethanol prices in Brazil declined driven by a seasonal slowdown in demand for ethanol-blended fuels and reduced industrial usage. Despite a temporary reduction in sugarcane processing total ethanol production rose, bolstered by a 14 % increase in corn ethanol output. Enhanced domestic production and inventory adjustments led to a market surplus, exerting downward pressure on prices. Additionally, lower sugarcane prices further decreased production costs, allowing manufacturers to lower selling prices. Ongoing adverse weather conditions, including droughts and fires, raised concerns about future harvests, despite overall production gains. The quarter-on-quarter change recorded a slight increase of 1%. Price comparison between the first and second half of the quarter showed no significant variation, emphasizing the overall stability in pricing trends. The quarter-ending price for Ethanol Anhydrous FOB Santos in Brazil stood at USD 700/MT, reflecting the prevailing stable pricing sentiment in the region.
For the Quarter Ending June 2024
North America
In Q2 2024, the North American ethanol market has experienced a notable increase in prices, driven by several significant factors that have influenced market dynamics. The quarter has been marked by increased production costs, primarily due to rising corn prices, the primary feedstock for ethanol production. Moreover, heightened energy costs, particularly for natural gas used in the ethanol production process, have further contributed to escalating production expenses. Seasonal factors such as the summer driving season have also played a crucial role, with increased gasoline consumption leading to higher demand for ethanol, which is blended with gasoline. Regulatory influences, including potential increases in Renewable Fuel Standard (RFS) blending requirements, have further bolstered ethanol demand.
Focusing on the USA, which has witnessed the most substantial price changes, the overall trend in Q2 2024 has been one of increasing prices. Seasonality has contributed significantly, with the summer driving season pushing ethanol demand higher. This period has also seen heightened demand from industrial sectors, adding further pressure on prices. There has been a substantial 14% increase from the previous quarter in 2024.
The quarter-ending price for ethanol in the USA stands at USD 641/MT for 99% FD Houston, underscoring the positive pricing environment. This consistent increase in ethanol prices reflects a robust market responding to supply constraints and higher demand, positioning the overall sentiment as decidedly positive for Q2 2024.
APAC
In Q2 2024, the ethanol market in the APAC region experienced an upward pricing trajectory, driven primarily by a confluence of factors. The primary catalysts were heightened demand for ethanol blending in gasoline due to regulatory mandates, increased industrial applications, and higher global crude oil prices, which propelled ethanol as a competitive alternative. Additionally, supply-side constraints, including logistical disruptions and elevated freight costs, exacerbated the supply-demand imbalance. Raw material price hikes, notably in corn and sugarcane, further contributed to the escalated production costs, thus pushing ethanol prices higher.
Focusing on South Korea, which witnessed the most pronounced price changes, the seasonal demand for gasoline blending during the driving season significantly boosted ethanol consumption. The constraints in domestic ethanol production capacity and reliance on imports intensified the price pressures. The correlation between rising global ethanol prices and local market dynamics exacerbated the situation. The quarter-over-quarter increase from Q1 2024 also stood at 11%, reflecting a sustained upward trend.
Concluding the quarter, the price of ethanol 99.5% CFR Ulsan in South Korea reached USD 825/MT. The pricing environment for ethanol in South Korea throughout Q2 2024 was predominantly positive, characterized by strong demand and constrained supply dynamics that collectively drove prices upward. This market behavior underscores the critical balance between regulatory influences, industrial demand, and global supply chain stability, all contributing to the observed price escalation.
Europe
In Q2 2024, the ethanol market in Europe experienced a notable upward trajectory in pricing. The quarter has been marked by a convergence of several critical factors that collectively influenced market prices. Heightened demand for ethanol, driven primarily by increased fuel blending mandates and robust industrial applications such as solvents, played a pivotal role. Seasonal demand spikes, particularly with the onset of the summer driving season, further exacerbated consumption pressures. Concurrently, supply-side disruptions, including logistical challenges at ports and reduced imports from key suppliers like the USA and Brazil, compounded the strain on availability. Additionally, rising feedstock costs, particularly for corn and wheat, coupled with escalating energy prices, have elevated production expenses, thereby pushing final selling prices higher.
Germany witnessed the most significant price changes, reflecting broader trends and seasonality within the European ethanol market. The quarter's overall sentiment remained bullish, with ethanol prices in Germany demonstrating a steady climb. From the previous quarter in 2024, prices surged by 10%, underscoring a strong demand-supply imbalance. The first half of the quarter saw a 9% increase in prices compared to the second half, highlighting the intensifying demand as summer approached. The quarter ended with ethanol prices in Germany at USD 741/MT, CFR Hamburg, reflecting a consistent uptrend.
Overall, the pricing environment for ethanol in Europe during Q2 2024 has been positively skewed, driven by robust demand dynamics and constrained supply. The market has responded predictably to seasonal patterns and broader economic pressures, marking a period of significant price appreciation within the context of the current fiscal year.
South America
Throughout Q2 2024, the South American ethanol market experienced a mixed trend. In the early part of the quarter, particularly in April and May, prices rose due to several factors. High sugar prices incentivized sugarcane mills to prioritize ethanol production, tightening supply. Increased domestic and export demand, coupled with adverse weather conditions and production disruptions, further strained supply chains. The floods in Rio Grande do Sul exacerbated the situation by disrupting transportation and blending mandates, leading to higher ethanol prices.
However, towards the end of Q2, particularly in June, prices began to decline. This decrease was attributed to a surplus in supply resulting from robust production capabilities, which exerted downward pressure on prices. Fluctuations in global demand, especially in key export markets, and seasonal variations in production and demand dynamics also contributed to the decline.
Overall, ethanol prices in Brazil fell by 9% from the previous quarter and an additional 3% between the first and second halves of the quarter. By the end of Q2 2024, the price for Ethanol Anhydrous FOB Santos was USD 701/MT. This period was characterized by a culmination of factors such as sugarcane harvest variations, government policies, and global oil prices, which collectively influenced the pricing environment.
For the Quarter Ending March 2024
North America
The first quarter of 2024 has been challenging for the North American ethanol market, with prices experiencing a consistent downward trend. Several factors have influenced market prices, including reduced demand both domestically and internationally. The off-season lull in Europe and a downturn in the transportation industry have contributed to the decrease in ethanol demand. Additionally, ample feedstock availability following the harvest season has led to increased ethanol production and higher inventory levels.
In the USA, the largest ethanol producer in the region, prices have seen the maximum price changes. Overall, there has been a negative correlation in price changes, with prices decreasing by 3% compared to the previous quarter. The first half of the quarter recorded a price decline of 4% compared to the second half, further reflecting the decreasing trend.
The latest quarter-ending price for ethanol in the USA is USD 507/MT of Ethanol 99% FD Houston. This marks a significant decrease from the same quarter last year.
In conclusion, the pricing environment for ethanol in North America during the first quarter of 2024 has been negative, with prices consistently decreasing. Reduced demand, ample feedstock availability, and a seasonal lull in the market have all contributed to the downward trend in prices.
APAC
The first quarter of 2024 has witnessed a significant decline in ethanol prices in the APAC region, with South Korea experiencing the maximum price changes. The overall trend in the market has been negative, with prices decreasing due to various factors. These factors include lower demand, oversupply, reduced blending mandates, and weak global energy prices. The decrease in ethanol prices in South Korea can be attributed to seasonality, as the first quarter typically sees lower demand for ethanol due to reduced blending requirements and lower gasoline consumption. However, in February, there was a slight increase of 1.5% in ethanol prices in South Korea due to recent increases in the ethanol blending mandate for gasoline, coupled with the upcoming spring season driving up ethanol demand. This mandate necessitates more ethanol for blending, tightening domestic supply and pushing prices upward. Additionally, the correlation between ethanol prices in South Korea and global energy prices has contributed to the decrease in prices.
Compared to the same quarter last year, ethanol prices in South Korea have declined by 27%. This decline is also evident when comparing the current quarter to the previous quarter in 2024, with prices recording a decrease of 6%. Furthermore, when comparing the first half and second half of the quarter, prices have remained relatively stable, with a change of only 1%.
As of the end of the quarter, ethanol prices in South Korea have been assessed at USD 649/MT, 99.5% CFR Ulsan. Overall, the pricing environment for ethanol in the APAC region during the first quarter of 2024 has been negative, with prices experiencing a significant decline.
Europe
The first quarter of 2024 has been characterized by decreasing prices in the European ethanol market. Several factors have influenced market prices, resulting in a negative pricing environment. The significant factors contributing to the decline in ethanol prices include abundant supplies stemming from corn harvests in key producing regions such United States and Brazil, expanded production capacities, and increased imports. These factors have led to a surplus supply, impacting pricing trends. Additionally, anticipated spikes in energy prices and an upswing in upstream corn prices have contributed to an escalation in production costs. The demand for ethanol has been affected by economic uncertainties, environmental concerns, and the shift towards electric vehicles and renewable energy sources, which have diminished reliance on ethanol. Transportation and blending challenges, along with logistical bottlenecks and high shipping costs, have further impacted the demand for ethanol. Overall, the pricing environment for ethanol in the European region has been negative, with prices experiencing a significant decline.
In Belgium specifically, there has been a decrease in ethanol prices of 48% compared to the same quarter last year. The quarter-on-quarter decrease is 8%, while the price change between the first and second half of the quarter is -2%. The latest quarter-ending price for ethanol in Belgium is USD 606/MT.
South America
In Q1 2024, the South American ethanol market, led by Brazil, saw stable pricing supported by various factors. January witnessed a slight decline in prices due to surplus supply from increased sugarcane processing, partially offset by reduced demand amid lower gasoline prices and economic challenges.
However, February and March saw prices incline by 4.8%, driven by rising gasoline prices, increased economic activity, and changes in storage and transportation costs. Stable production costs, consistent domestic demand, and efficient export infrastructure bolstered market stability despite rising freight costs.
Government policies, like buffer stocks and export controls, further contributed to price stabilization. Although ethanol prices in Brazil declined by 1% compared to the previous quarter, they increased by 35% year-on-year, with a 13% increase within Q1 2024.
This mixed trend reflected seasonal fluctuations, changes in government policies, and global market dynamics in sugar and oil prices. Brazil's intensified sugarcane processing and ethanol production signaled rising demand domestically and globally, positioning the country as a significant player in the international ethanol market.
Consequently, the quarter-ending price for Ethanol in Brazil stood at USD 684/MT, showcasing the positive pricing environment and the market's resilience in Q1 2024.
For the Quarter Ending December 2023
North America
The North American Ethanol market has witnessed fluctuations in the current quarter of 2023 due to various factors. The market has been stable, with moderate supply and demand. The increase in upstream corn prices and energy prices has led to a rise in Ethanol production costs, while destocking and decreasing freight rates have supported a decrease in prices. The USDA's loans and grants for rural energy development and increased demand from the downstream biofuel industry have supported a price hike. The US has had the most significant changes in prices, with a bearish market situation.
The bumper production of corn has been the primary reason for the slight decrease in prices as the upstream prices have eased in the US market. The increase in global crop production and consumption, increased distiller's dried grains with soluble adoption, and easing black sea supply concerns have led to a moderate demand. The latest Ethanol 99% FD Houston price in the US has been USD 591/MT.
APAC
The APAC region's ethanol market in Q4 2023 has faced a bearish trend due to several reasons. The supply of ethanol to Oil Marketing Companies (OMCs) has fallen to 2.27 billion litres, causing a moderate to high supply in the region. Increased energy prices, upstream corn prices, and a decrease in freight rates have affected the ethanol market. The anticipation of a decline in sugar cane production and year-end destocking has led to a drop in corn and ethanol prices in the region. South Korea has been the country with the most significant changes in ethanol prices. The country's sugar production has increased to 434.79 million tonnes, leading to a stable supply of ethanol. The prices of ethanol in South Korea have registered a declining trend due to record production of sugarcane worldwide and destocking season. The price of corn has also tumbled to a three-year low due to increased supply from the US and Brazil, leading to a decrease in ethanol prices. The APAC region's ethanol market has faced a -31% decline in prices compared to last year's same quarter and a -24% decline in prices compared to the previous quarter. The price percentage comparison of the first and second half of the quarter in South Korea has been -22%. The current quarter's price of Ethanol 99.5% CFR Ulsan in South Korea is USD 697/MT.
Europe
The Q4 2023 for the European Ethanol market has been impacted by several factors. Firstly, year-end destocking has led to a drop in prices for corn and ethanol. Secondly, decreasing freight rates have supported a drop in ethanol prices. However, increased energy prices and upstream corn prices have led to an increase in production costs. Belgium has had the maximum changes in prices with a downtrend due to the record production of sugarcane to serve the domestic market. The trend for Ethanol, FD Antwerp has been -24% from the previous quarter. The percentage change from the first and second half of the quarter has been -21%. The percentage change from last year's same quarter has been -43%. The primary drivers for the upward revision of global crop production and consumption have been the adjustment of the Russian harvest. The long-delayed operation of advanced biofuel production has caused several companies to declare bankruptcy and has dampened investment in these once-promising technologies of biofuel. The latest price of Ethanol, FD Antwerp in Belgium for Q4 2023 has been USD 683/MT.
South America
The South American Ethanol market witnessed a stable quarter with moderate supply and low demand. Despite strong demand in the biofuel market, new players controlled prices with ample production. Brazil, being the largest producer of Ethanol, saw a decline in prices due to record production of sugar and high domestic inventory. However, Vibra Energia capitalized on its energy transition by using Ethanol to power cars in Latin America's biggest economy. The forecasted pricing trend for Ethanol in Brazil shows a bearish market with high supply and low demand. The increase in corn production and further decrease in freight charges will support a price drop. The quarter saw a crush of 43.09 million metric tons of sugarcane, and any disruptions in sugarcane harvesting due to possible rainy weather may cause a shortage of supply to the Ethanol manufacturing industry later. The current quarter's price of Ethanol Anhydrous FOB Santos in Brazil is USD 630/MT.
For the Quarter Ending September 2023
North America
At the start of the third quarter, Ethanol prices maintained stability but dropped in August. A surge in Ethanol output, due to a higher price gap between end-use oil prices and raw material corn prices, forced Ethanol prices to become cheaper again, like the previous month. Moreover, the industry remains a little skeptical about increasing demand for downstream renewable green industries such as biofuel, vegetable oil, biodiesel, etc. The recent move by The Biden administration towards minimizing blending protocols, coupled with surging gasoline demand, will pose challenges to the industry. This downward change in prices has been further attributed to ample domestic inventory levels and superior production volume coupled with high export scenarios. In September, a fall in Ethanol yield and continuous stock consumption led to a 4.7 percent price jump. According to data released by the Energy Information Administration (EIA) on Aug. 30, US Ethanol production fell by nearly 4 percent, and fuel stocks were down by more than 5 percent for the week ending Aug. 25. A sharp growth in demand has been observed in the high-purity alcohol industry. Greenfield Global Inc., a world-renowned manufacturer and distributor of specialty alcohols and solvents, increased its production capacity in its Johnstown distillery from 30 million gallons per year to 70 million gallons per year. POET, the world’s largest producer of biofuels, reopened its Cloverdale bioprocessing facility, signaling lucrative demand for Ethanol. As of September 29, Ethanol prices in the North American market were hovering around USD 850 per metric tonne.
APAC
At the start of Q3, Ethanol prices continued the bullish trend from the last quarter in the Asian market. The government's target to achieve E12 (12% Ethanol with gasoline), industry focus on environmentally friendly practices, and a change in consumer behavior towards a cleaner lifestyle due to higher per capita income, have all driven the demand for Ethanol for consecutive months. In August, Ethanol prices in India's market remained quite stable while in China, they continued the bullish trend. The high demand for sugarcane in the end-use industry and the diversion from Ethanol to sugarcane products have helped the sugar mills maintain enough margin. Hence, producers have shown reluctance to revise to a lower value quotation. However, the markets in the Philippines and South Korea have conflicted. A drop in Ethanol prices in America, a major exporter of Ethanol, coupled with sluggish demand in the solvent industry, have kept the prices of Ethanol on the lower side in the Philippine and South Korean market. In September, the overall Asian market trended upward, including the Philippines and South Korea. The weak monsoon effect on India's crop production, Black-sea corn supply concerns, and a drop in Ethanol production in the U.S have negatively affected the market sentiments. As of September 29, Ethanol prices in Asian continents have been trading around USD 950 per metric tonne.
Europe
In the first half of the third quarter, Ethanol prices in the Eurozone continued to follow the bearish trend of the previous month. The downstream industry's demand for Ethanol has been lower as the blended ethanol policy has not yet been implemented. Moreover, the sufficient availability of the chemical from overseas suppliers forced the Ethanol market price to decrease again at the front-month. A proposed bill by the German environment minister on phasing out crop-based production to fortify Europe’s food security negatively affected market sentiments. The availability of cheaper ethanol from the US, for which the Netherlands has been the fourth-largest export destination, further supported a drop in Ethanol prices. However, Ethanol prices started traveling upwards from September. This is due to an increase in Sugar prices in major Ethanol producing countries like Brazil, as the major sugar producing nations India and Thailand have limited their overseas exports due to plummeting production. The adverse effects of El Nino led to bad weather causing production efficiency loss. The Euro closed at a 5-month low against the dollar, after the ECB’s announcement that they might pause the rate hike cycle. The downstream biofuel industry has been growing steadily since the European Commission has been trying to increase the blending percentage of Ethanol with Gasoline further. Major exporters like the U.S. and Brazil have also raised their quotation prices. As of September 29, Ethanol prices in the Eurozone were hovering around USD 890 per metric tonne.
South America
Ethanol prices in the third quarter continued to follow the bullish trend from the previous month. In the Brazilian market, it has been reported that all feedstocks have been used up and operable biofuel production capacity fell slightly at the end of July 2023. Unica, the Brazilian Sugarcane Industry Association, announced that ethanol production was down for two weeks while sales were up due to high demand in the biofuel industry. Additionally, the Brazilian government's move towards higher ethanol blending in gasoline by 3% and the announcement by Stellantis NV, the world's fifth-biggest automaker, about the production of flex-hybrid vehicles using ethanol and electricity in Latin America's largest economy, has elevated the market. A recent deal in August between Shell and the University of Sao Paulo, Hytron, was disclosed to produce green Hydrogen from Ethanol, which will then be planned for use in buses and trucks. Moreover, erratic weather throughout the July-August monsoon and government restrictions have limited sugar exports in sugar-producing rivals India and Thailand, which have projected a higher demand for Brazilian sugar in the sweetener industry. The resulting decrease in sugar stock and concerning drop in sugarcane production in the upcoming season have led the federal governments to activate embassies in various exporting countries to strengthen political relations and import sugar from them.
For the Quarter Ending June 2023
North America
The prices of Ethanol in the US market have hiked significantly as of Q2, and this was due to increasing downstream demand industry like Fuel and paints. Additionally, the prices of Natural Gas have supplemented the input production cost. Furthermore, increased economic stability and lowered the inflation rate, which came down from 4.9 in April to 3 in June amid the government announcement of the U.S Department of Agriculture's plans to invest up to $500 million to increase the availability of domestic biofuels, created optimistic Ethanol market trend in Q2. Furthermore, an increment in the feedstock corn prices in the US market caused an increase in the prices of downstream Ethanol. Moreover, there was stable demand from the international market. In addition, there was procurement of large orders from the biofuel industry along with plants operating at stable rates to meet domestic and international demand. Thus, at the end of Q2, the prices of Ethanol in the US market were stated at USD 851/MT Ethanol 99% FOB Texas.
Asia Pacific
In the second quarter of 2023, the prices of Ethanol in the Chinese market have declined constantly at a stable rate. This was due to the slow economic recovery in China amid the deflation problem. Additionally, declining exports in China amid weak demand from the domestic and international markets led to weak demand from the biofuel industry. Furthermore, there was a decrement in demand from the downstream transport and logistic sector amid declining feedstock corn prices, creating an overall pessimistic Ethanol market view. In addition, the plants were operating at a lower rate due to weak domestic and overseas demand. Furthermore, due to peak harvesting season in the US market, there was a free flow of Feedstock corn in the market amid declining coal prices from Australia as it was offering coal at discounted prices, trying to win back consumers and increase international demand, which led to a decrement in the input production cost. Therefore, as of ending Q2 June, the prices of Ethanol in the Chinese market were stated at 819/MT Ex-Shanghai.
Europe
As of Q2, the prices of Ethanol have shown declining trends but at a variable rate. As of the beginning of Q2, in the first half, the prices declined at a slightly slower rate. Furthermore, in the second half of Q2, the prices declined amid the euro central bank decided to increase the interest rate it was due to increased interest rate as there was increment to 3.75% as of June. And high inflation led to a decline in demand from the downstream industry like the transportation and logistics sector. In addition, the continued high inflation rate led to a decrement in demand from the downstream industry like the biofuel industry. Furthermore, there was a free flow of inventory from the international market, which led to sufficient inventory levels to meet downstream demand. Moreover, there was a declining trend in PMI as its value in June declined to 43.20, indicating a contraction in the manufacturing sector. Additionally, the prices of Natural gas have declined significantly, leading to a decrement in input production costs. So, at the end of Q2 in June end, the prices of Ethanol in the Netherlands Market were stated at USD 1082/MT FD Rotterdam.
For the Quarter Ending March 2023
North America
Overall market dynamics of Ethanol in the North American market remained stable on account of a balanced production rate and available stockpile with end-use manufacturing units. USDA figures showed an increase in production rate and increased demand for the commodity in the biofuel production industry. Domestic and foreign demand for the product was mild, and the producer had an abundant stockpile to meet domestic demand. Towards the quarter end, the final price of Ethanol was determined by the tight supply of sugar in the US market, as well as the rising demand from the biofuel and food industries. Senators from the United States were attempting to increase the international market for its Ethanol gas blend. Towards the quarter end, Ethanol prices were observed at USD 755 per MT, FOB Texas.
Asia Pacific
The overall market dynamics of Ethanol in the Asia-Pacific market declined slightly on account of the fluctuating demand outlook for the product. The Chinese market restarted operations in the country and trading in the foreign market during the Lunar post holidays in the country. End-user manufacturers continued to confront workforce shortages and fewer product inquiries. Manufacturing firms' recently signed orders remained constant while their inventories increased. Several enterprises had reopened at the same time, and supply was increasing. Prices were too high, restrictive downstream demand. Buyers showcased wait-and-watch behavior before placing larger orders towards the quarter's end. Corn market volume in the production area remained strong, but port corn arrival volume increased. At the same time, downstream demand remained static, and buyers were hesitant to place orders. Towards the quarter end, Ethanol prices were observed at USD 895 per MT, Ex-Shanghai.
Europe
In the first quarter of 2023, the market prices of Ethanol followed the inclined trend In the European market. Because of the ease of the import, the German providers received the ethanol consignment from the United States with declined transit time. Biofuel continued to be in high demand in the local market throughout the quarter. The observed rise in energy prices raised production costs. Demand for the product from food services, as well as demand for Ethanol blended biofuel. To meet food industry demand and reduce reliance on imported oil, the European government intended to prohibit the use of vegetable oils in the production of biofuel. As a result, demand for the product from ethanol-based biofuel companies, as well as the pharmaceutical and food sectors, has increased, affecting final Ethanol prices on the European market. Towards the quarter end, Ethanol prices were observed at USD 1120 per MT, CFR Hamburg.
For the Quarter Ending December 2022
North America
In the last quarter of 2022, mixed price dynamics were observed in the North American market on account of production capacity and demand strength. The Ethanol prices increased towards the mid-quarter as the production capacity increased and the stock was low. The employment rate declined, and the inflation rate remained persistently higher in the country, impacting the final prices. The feedstock (corn) prices were also high during the food crisis and high energy costs. Towards the quarter's end, the stockpile increased, according to the United States Department of Agriculture (USDA). Christmas and New Year holidays, along with the disruption caused by the storm Elliot, declined the overall Ethanol market prices. The demand for Ethanol for gasoline production remained moderate in the regional market.
Asia Pacific
The overall market dynamics of Ethanol in the Asia-Pacific market remained stable throughout the fourth quarter of 2022. The Chinese market witnessed a hike in COVID infection cases, hampering the production capacity in the domestic market. Major financial hubs of the country halted production amidst the economic disruption in the country. Towards the quarter's end, Ethanol prices rebounded as the production cost increased. Commodity prices increased, and the demand for the product for biofuel production became moderate. The energy cost in the regional market soared along with the coal prices in the Asian market throughout the quarter, proportionally impacting the final prices of Ethanol. Restricted movement and New year holidays in the country impacted the final production cost of Ethanol in the Asian market.
Europe
In the European market, the market prices of Ethanol followed the northward momentum in Q4 of 2022. Economic uncertainty remained continuous in the European market leading to high inflation rates and energy prices proportionally impacting the production cost of Ethanol. The EU focused more on producing sugar and fulfilling the food shortage in the country. Importing prices of Ethanol in the country increased from Germany, and end users showcased a stable market trend. With increasing energy prices, the demand for Ethanol-blended fuel remained on a positive edge; hence, the final prices in the last quarter followed the northward momentum.
For the Quarter Ending September 2022
North America
In the third quarter of 2022, Ethanol prices experienced mixed sentiments in the US market. According to experts, ethanol production remained on the lower side in July. However, demand for the commodity increased in August as corn and sugarcane prices followed the domestic market's upward trend. The cost of producing Ethanol increased in the domestic market as significant players saw a frenzy to feed supply to meet domestic demand. The product's demand from downstream, pharmaceutical, and biofuel production remained strong, causing price inclination in the US market. Suppliers and Ethanol manufacturers received fewer inquiries about the product from end-use businesses, resulting in a decrease in Ethanol prices in the local market. The demand from the international market was at an all-time high, significantly raising domestic prices.
Asia Pacific
During the third quarter of 2022, Ethanol prices witnessed mixed sentiments in the Asian market owing to the robust demand outlook and feedstock availability. According to the Renewable Fuel Association (US), the Chinese government imported less Ethanol from the US, showcasing less demand from the downstream sector. However, the demand for Ethanol in China increased towards the quarter as biofuel production increased. In India, Ethanol prices increased by more than 3% as the Indian government met its 10% ethanol-based fuel target and now wants to increase the ethanol quantity. The cost of producing Ethanol in Asian countries has also risen due to rising fuel prices. Ethanol prices towards the end of Q3 were observed at USD 1050 per MT, Ex-Shanghai (China).
Europe
In the European market, Ethanol prices fell in the third quarter of 2022 owing to rising recession fears and soaring natural gas prices. Due to higher inflationary rates and lower Ethanol supply, demand for Ethanol from biofuel production in the German market remained under pressure. During the third quarter, the North Sea ports of Germany experienced a union worker strike, which delayed transit and hampered supply. The country's major ports have piled up vessels with less momentum. The lag in Ethanol prices in Germany was caused by feedstock corn and sugarcane prices, as well as weak demand from the pharmaceutical and personal care sectors. However, feedstock, corn, and sugarcane prices remained low throughout August, affecting ethanol prices in the domestic market proportionally. In September, the prices of Ethanol were USD 1180 per MT, CFR Hamburg (Germany).
For the quarter ending June 2022
North America
In the North American market, Ethanol prices regained their strength and were observed at a positive edge during the second quarter of 2022. Major players of Ethanol quoted the costs as $998 per MT, FOB Texas towards the quarter-end. Commodity inflation occurred succeeding the war between Russia and Ukraine. Corn and sugarcane prices skyrocketed in the second quarter as the crop yield in the regional market declined. As compared with Q1, a hike of 2% was witnessed in the prices of Ethanol as the production cost elevated, accompanied by the escalated feedstock prices. The demand for biofuel production was also high in the regional market, governing Ethanol market dynamics in the North American region.
Asia Pacific
In the Asia-Pacific market, the prices of Ethanol declined during the second quarter of 2022 due to rising COVID infection and lack of production activity. The quarter started with a positive note at the prices of Ethanol as they were quoted at $1140 per MT, Ex-Shanghai in April. Despite the increase in feedstock, corn prices, and slow demand from end-users, the market sentiments remained on the brim. Facets such as rising infection, strict lockdown, and public holidays halted the operational rate of Ethanol in the regional market. The vessel movement got restricted, leading to a supply shortage among significant manufacturers of Ethanol. In South Korea, truckers went on strike, halting the operational rate of Ethanol in the regional market. Towards the end of the quarter, the market prices were observed at $1122 per MT, Ex-Shanghai, China.
Europe
During the second quarter of 2022, Ethanol prices followed the European market's upward trajectory. The inflated commodity prices raised the feedstock, corn, and sugarcane prices, leading to high production costs. Gasoline prices also elevated in the European region as the temperature rises. Furthermore, the rough transportation of the product from major supplying countries such as the US and Brazil led to shortages among the manufacturers. This increment led to high production costs, consequently impacting the production cost of Ethanol during the Q2. The significant facet governing the prices of Ethanol is the surging demand for Ethanol for biofuel production. Continuous demand from the end-users has proportionally influenced the market dynamics of Ethanol. As a ripple effect, the prices got assembled at USD 1480 per MT, FD FD Frankurt, Germany towards the quarter-end.
For the Quarter Ending March 2022
North America
In the first quarter of 2022, the prices of Ethanol in the North American market fluctuated from USD775/ton, FOB Texas to USD 870/ton, FOB Texas USA towards the first quarter end of 2022. As compared with Q4 of 2021, the prices have witnessed a decline of 19% in Q1 of 2022, as the tension between Russia and Ukraine escalated and ethanol manufacturers faced tight supplies from feed (corn) producers. The prices of corn skyrocketed during this quarter, as a ripple effect, the production cost of Ethanol soared towards the quarter end. These all factors have contributed largely to the prices of Ethanol in the North American market.
Asia Pacific
In the Northern Market, the prices of Ethanol surged accompanied by the hiked prices of feed (corn) in the first quarter of 2022. The prices observed in Q1 of 2022 showcased a hike of 20% as compared with Q4 of 2021. Robust demand from downstream pharmaceutical, cosmetics affected the prices of Ethanol in the Asian market positively. The tension between Russia and Ukraine resulted in feedstock supply as trade route disruption occurred, forcing the manufacturers to spike up the production cost of Ethanol. The prices in China at the quarter end of 2022 were observed at USD1175/ton, Ex-Shanghai, China. Moreover, the implementation of lockdown in China have halted the production of Ethanol temporarily.
Europe
The prices of Ethanol in the first quarter of 2022 showed sporadic momentum throughout the first quarter in the European market. Varying demand from end users such as disinfectant affected the prices of Ethanol. When compared with the previous quarter of 2021, the prices have shown an escalation of 4% in Europe. Shortage of feed corn and sugarcane occurred due to the war between Russia and Ukraine negatively affecting the trade route, which showed directly proportional effect on the prices of Ethanol. In this quarter, the prices of Ethanol ranged from USD1075/ton, CFR Hamburg to USD1055/ton CFR Hamburg, Germany, towards the quarter ending March 2022.
For the Quarter Ending December 2021
North America
In the fourth quarter of 2021, North America’s Ethanol market remained consolidated throughout the quarter. The demand outlook from the domestic and overseas market exceeds the production capabilities as the high prices of corn forced the plants to reduce their production capabilities. Whereas, numerous plants declared turnarounds ahead of the schedule to avoid high-priced feedstock. Several market participants were anticipating that the current trend is likely to prevail till the next quarter. As a ripple effect, the Ethanol offers soared to the historical high in the Q4 of 2021, and FOB California discussion for Ethanol was peaked at USD 694 per tonne, in November 2021.
Asia Pacific
In the fourth quarter of 2021, the Ethanol market in the Asia Pacific persistently soared the prices for showcased mixed sentiments based on the regions. Ethanol offers soared throughout the Asia Pacific due to numerous reasons. However, in India, the decision of Indian authorities to boost domestic Ethanol production led to a larger deficit in the global sugar supply. In addition, recently GAIL and GACL JV set up a second-generation Bio-Ethanol plant in Gujrat India. As a ripple effect, the Ex-Mumbai offers for Ethanol were settled at USD 810 per tonne, during the quarter ending December 2021.
Europe
Since, July 2021, the EU Commission set of proposals term “Fit for 55 Package” to align with the European Green Deal and European Climate change setting stricter norms to achieve carbon neutrality by 2050. Whereas, the ongoing energy crisis and limited Natural Gas stocks, supply concerns kept the domestic market sentiments depressing in Europe. In terms of demand outlook, the German market in 2021 failed to mirror the gains witnessed in France and UK. As a ripple effect, the offers for Ethanol in the German market remained buoyed, and CFR Hamburg's discussion for Ethanol was settled at USD 1056 per tonne, during the quarter ending in December 2021.
For the Quarter Ending September 2021
North America
The prices of Ethanol rose significantly in the market of North America in Q3 2021. Limited supply of feedstock, logistics issues, tight production, and continuous rise in the crude oil prices led to the soaring ethanol prices in the region during Q3. Hike in the demand from major downstream industries was observed during the quarter. Exporters revealed that the demand for feedstock corn from China increased effectively in Q3 2021, which further affected the prices of feedstock corn in the US market. Some plant turnarounds reported due to aftermaths of Hurricane Ida affected the regional supply. The FOB price of Ethanol was assessed at USD 849/MT during the final week of September in the US.
Asia
The prices of Ethanol remained stable to firm throughout the 3rd quarter of 2021 in the Asia Pacific region. Disruption in the supply of Ethanol was observed during Q3 influenced by the increased freight costs in China. In India, the price of Ethanol was settled around USD 726 per MT in the month of September. The price trend remained stagnant in the country owing to the stable demand from the domestic market and ample stock availability. Market players mentioned that the ambition of blending 20% Ethanol in fuel is getting tougher due to inflationary trend in its feedstock prices.
Europe
The European market witnessed a hike in the prices of Ethanol due to low raw material availability, high purchasing power, lower industrial production, and higher logistic costs in the third quarter of 2021. The demand for Ethanol grew at an exponential pace from the downstream industries during Q3. The pricing kept the uptrend in the European region due to the international pressure.
For the Quarter Ending June 2021
North America
Ethanol prices traced an upward trajectory during this quarter in USA, backed by firm downstream demand and feedstock shortage in the country. Major reason behind the consistent rise in prices was huge shortage of feedstock corn and sugarcane in the global market. Major USA exporters revealed that demand for feedstock corn from China increased effectively over this period, which also affected the prices of feedstock corn in US market. Therefore, huge spike in prices of feedstock commodities and high demand from fuel blending sector led to a consistent rise in prices of Ethanol in the country. Thus, prices of Ethanol hovered around USD 1585/MT during the final week of June in USA.
Asia
Prices of Ethanol increased in Asia during this quarter, backed by several domestic and global factors. In India, the rise was primarily driven by strong domestic demand following high consumption from sanitizer manufacturers under resurgence of pandemic. Besides, demand from pharmaceuticals sector remained firm throughout the quarter in Indian market. Meanwhile, China faced huge shortage of feedstock corn and sugarcane in the country, and manufacturers were compelled to procure expensive feedstock from USA, which led to a consistent increment in price of Ethanol in the country during this timeframe. Therefore, after an effective rise throughout the quarter, prices of Ethanol hovered around USD 1040/MT in the last week of May in India.
Europe
European market experienced frequent fluctuations in demand for Ethanol during this quarter. Uncertainties regarding pandemic cases in the major Europe maintained the market volatility of the region, which caused an uncertain demand outlook during this quarter. Prices kept on rising due to international pressure, where feedstock prices pushed up the prices of Ethanol in the global market. Therefore, despite of the demand volatility, prices of Ethanol remained firm across Europe during Q2 2021.
For the Quarter Ending March 2021
North America
In North America, the price of Ethanol surged due to production cuts and high demand from the domestic consumers as well as for exports. Ethanol prices skyrocketed during Q1 2021 as an effect of low feedstock corn availability. Furthermore, winter season disrupted the production activity across the gulf coast that led several production plants to face unplanned shutdowns during January-February. In addition, USA exports skyrocketed due to sudden rise in export demand from China.
Asia
In the Asian markets, overall demand for Ethanol remained firm from the downstream sectors during Q1 2021. In China, demand from the disinfectant sector maintained stability over the prior quarter. Furthermore, to satisfy this demand, China imported a huge quantity of Ethanol from the US. In addition, feedstock corn prices in China were 35-45% high. Meanwhile, in the Indian market, heavy availability of feedstock sugarcane pushing down the prices of Ethanol for 3 months consecutively, CFR India prices of Ethanol settled down from USD 883.2 per MT (January 2021) to USD 750 per MT (March 2021).
Europe
Limited supply for Ethanol across the region supported its prices during Q1 2021. Though Europe is largely depending upon Ethanol imports from USA, tight supply kept a tab on the product availability. The supply from USA remained low due to low feedstock production and high exports and domestic demand in the country. Meanwhile the demand from disinfectant or sanitizers manufacturers remained stable throughout the quarter.
For the Quarter Ending September 2020
North America
The demand for Ethanol in North America showcased stagnancy after a rapid spring rally in the previous quarter. In August and September, the demand as well as the production plateaued and settled below the critical levels in comparison to thick corn harvest. As per the available data, the demand is primarily a result of the falling stock in contrast to the consistent rise in production since the beginning of July. The upward trend in Ethanol demand as fuel is also in jeopardy, with U.S ending with its peak seasonal travelling months.
Asia
The Asian Ethanol market faced marginal supply shortage as a fuel as well as an additive in beverage. With fears of resurgence of coronavirus in several parts of the region, the demand for Ethanol is expected to receive further boost as a feedstock for sanitizer and cleaning products in the coming months. Meanwhile, as traders and several downstream buyers are looking forward to pile-up feedstock to prepare for the tightened supply after the harvest season, the demand for Ethanol is anticipated to further move up. Capacity additions and expansions for Ethanol production on enhanced government support in India is likely to provide relief on the supply side in the near future.
Europe
The European Ethanol market witnessed further gains with travelling and trade activities tracing pre lockdown levels resulting in its increased demand as fuel. Manufacturers and traders remained optimistic over improved offtakes of the product as end-use industries begun stock piling ahead of the winter season to eliminate risk of supply shortage in the next quarter. However, with the fresh wave of coronavirus cases frightening the country in early September, an astonishing fear of demand uncertainty has prevailed in the near term.
