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Americas Asia Ethanol US

Exports to China remain attractive as national holidays come to an end

Offers in the Ulsan B-grade market sat once again just below the mid-500’s USD/m3 on Thursday. Buyers continue to hold off with no bids being put forward to match these offers, leaving PRIMA’s Ulsan Index B-grade market value sitting flat at 510USD/m3. Volatility in the Brazilian market and tightness in supply has continued to see many ethanol producers hold off on selling till stability returns.

After remaining quiet for the past few days, the Chinese returned from holidays on Thursday, and many market participants are still eagerly eyeing up potential exports to China. Vessel line-ups have shown another 46,000MT of ethanol is on route from New Orleans to China in October, with smaller shipments of fuel ethanol also going from the US to South Korea.

US markets drifted downwards yesterday after climbing higher since the beginning of the month, after the EIA reported a stock build of 30,000 barrels and production was increased by 7,000bbl/d. Arbitrage economics for Brazilian ethanol into the US have been suffering due to the recent increases in Brazilian prices, although despite this 16,500MT is due to be shipped from Brazil to the US in October.

 

NB 8/10/2015

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