BY CONTINUING TO USE THIS SITE, YOU ARE AGREEING TO OUR USE OF COOKIES. REVIEW OUR
COOKIE NOTICE

Register with us today

and in less than 60 seconds continue your access to: Latest news headlines Analytical topics and features Commodities videos, podcast & blogs Sample market prices & data Special reports Subscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you an email with your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

IF you are a Platts Market Center subscriber, to reset your password go to the�Platts Market Center to reset your password.

In this list
Agriculture

European fuel ethanol demand may be supported by industrial sector

Crude Oil |

How are Asian crude flows responding to US-China trade war, Iran sanctions?

Agriculture | Biofuels |

Platts Biofuelscan

Agriculture | Natural Gas | LNG | NGL | Oil | Crude Oil | Refined Products | Petrochemicals | Shipping |

Houston Energy Forum at the S&P Global Platts Energy Symposium

Agriculture |

Russian wheat arbitrage to Asia tightens, buyers seek Argentine grain

European fuel ethanol demand may be supported by industrial sector

London — Tumbling European fuel ethanol prices over October have increased the attractiveness of the product to industrial and beverage buyers, which could mean demand for fuel-grade product being supported in a time of seasonally weak demand and high supply.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

Sources reported increased inquiries by the non-fuel sector, as T2 ethanol prices plunged to over 14-month lows in the Eur440-Eur450/cu m range last month, as increased beet-based production and some imported volumes weighed on the T2 (duty paid) market.

Although fuel ethanol is not suitable for all industrial uses, high- quality product can often be sold directly to the traditional sector without rectification.

This offers a much needed buffer for European ethanol producers, whose margins have evaporated in the last month to below Eur10 from over Eur100/cu m for most of 2017.



In addition, some producers have rectification capacity and should fuel ethanol prices remain low, they could decide to switch some of their production in that direction.

T2 prices have recovered somewhat since the lowest point in October, last assessed at Eur456.50/cu m Thursday, but there appears little in terms of fundamentals so far to support any substantial increase.

Industrial prices have also suffered recently as the bearishness in fuel ethanol market has spilled over into the industrial market, sources say, with prices reported approximately Eur40/cu m lower than a few weeks ago for REN grade ethanol, a low grade of industrial product.

Apart from following the fuel trend, sources also said that some imported industrial volumes have added to the bearish trend for REN, but prices remain at a high premium to fuel ethanol, even taking into account the cost of rectification.

However, as industrial production capacity is limited, the effect is more likely to be channeled through higher demand for high-quality fuel ethanol, rather than increased rectification rates.

--Chrysa Glystra, chrysa.glystra@spglobal.com
--Edited by Jonathan Dart, jonathan.dart@spglobal.com