CropEnergies reports higher 2019-20 ethanol output but warns of coronavirus' impact

London — CropEnergies's ethanol output rose 3.6% to 1.002 million cu m in the 2019-20 (March-February) fiscal year, the Germany-based producer said Wednesday, but it warned about the impact of the coronavirus pandemic on the outlook for the current financial year.

The company said that record high revenues of Eur899 million ($976 million), up 15.4% year on year, were the result of "increased demand for climate-friendly alternative fuels and, accordingly, higher ethanol prices". S&P Global Platts T2 FOB Rotterdam ethanol assessment averaged Eur619.90/cu m over the company's 2019-20 fiscal year, up from Eur500.60/cu m a year earlier.

However, CropEnergies said it "expects a significant decline in revenues and operating profit in the current financial year 2020-21" due to the coronavirus pandemic. The company said that "although climate protection will remain a sociopolitical challenge in the medium term, the operating and mobility restrictions imposed since mid-March 2020 will have a negative impact on sales and prices, at least in the short term." It also said that maintenance work at its plant in Wanze, Belgium, was delayed by several weeks by the lockdown.

With a nod to the future, CropEnergies said it expected a rise in earnings over the course of the financial year as European lockdowns are eased, and increased mobility boosts demand for fuel.

The statement also highlighted the current increased demand for ethanol for disinfectant production, and the company said it was "working flat out to supply the market quickly." It said "after suitable conversion of production and filling... at all its production locations... CropEnergies supports local authorities with ethanol for the production of disinfectants."

CropEnergies has production facilities at four sites, with the following annual ethanol production capacities: Zeitz in Germany (400,000 cu m), Wanze in Belgium (300,000 cu m), Loon-Plage in France (190,000 cu m), and Wilton in Northeast England (400,000 cu m).

The company said it was impossible to forecast how this increased demand for disinfectant and reduced demand for fuel would balance out and therefore it would continue to provide updates as necessary to the market.