12 Mar 2020 | 09:04 UTC — Singapore

Philippines Feb domestic bioethanol reference price rises; may see supply delays

Singapore — The Philippines domestic bioethanol reference price climbed 2.59% on a monthly basis to Peso 61.74/liter ($1,210/cu m) in February, latest data from the Sugar Regulatory Administration (SRA) showed on Thursday.

Negros molasses prices climbed 5.8% month on month from January to Peso 11,921.77/mt in February resulting in an equivalent feedstock cost of Peso 50.5 liter (99 cents/liter).

Meanwhile, sugarcane costs climbed to Peso 28.40/liter in February, up 1.646% month on month.

At the same time, sources expect delays in ethanol resupply from the US, through the US Gulf Coast.

"US ethanol shipped from the US Gulf to Asia could be delayed by 10 days," said a market participant. The current drought in Panama affecting the water level of Gatun Lake canal resulted in the implementation of new water measures on February 15 for the Panama Canal, which is resulting in shipping delays.

Another trader expects delays of up to six weeks at least, with hold-ups at the Panama Canal as well as possible loading delays at the US Gulf Coast as the coronavirus outbreak in the US worsens.

It is getting more difficult to get ethanol resupply from the US due to the coronavirus outbreak, sources said, some of who see higher ethanol prices ahead.

"It is too early to predict the volume of disruption," said another market participant. "But if US plants are forced to close, or cities lock down, supplies could be disrupted," he added.

On the demand front, the declaration of a national emergency in the Philippines had seen companies push people to work from home, which could slash demand for fuel ethanol. "If a lockdown is imposed on part of the Philippines, demand will surely fall," said a buyer in Philippines.

The average imported fuel ethanol price for February was $463.48/cu m CIF Philippines, S&P Global Platts data showed, which was less than half of the locally produced ethanol price.


Register for free to continue reading

Gain access to exclusive research, events and more

Already have an account?Log in here