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Americas Asia Ethanol US

Brazil cargo drought lifts Asian ex-tank premiums

Firm numbers in the Ulsan B-grade market remained scarce on Tuesday, with no firm bids or offers being put forward, leaving PRIMA’s spot Ulsan B-grade index sitting flat at 540USD/m3. Availability of Brazilian B-grade product remains tight as Brazilian suppliers are reluctant to sell at current prices amid fears another gasoline tax hike could see prices rise even further. FOB Santos prices sat flat at 470USD/m3 on Monday.

Market indications are showing B-grade ex-tank prices sitting at huge premiums, with some quotes as high as 570USD/m3 for 2,000m3, as the lack of cargoes coming from Brazil is forcing end users to consider higher prices. There does not appear to be much demand in the Asian B-grade market for late Q415 and Q116, as buyers appear to be well covered for that period.

In the US market, there was little response to falling corn and RBOB prices, as most US prices either sat flat or rose slightly on Monday. UNICA data declares Brazilian ethanol exports to the US fell 67% MoM, from 134,128m3 in August to 44,912m3 in September.  Brazilian ethanol exports to South Korea sat at 35,475m3 for September, with 10,102m3 reported to have been cleared by South Korean customs, and the rest assumed to have been passing through Ulsan to wider Asian markets, in particular Japan. 

 

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