Ethanol, Fuels and Co-Product Pricing
Market Outlook: U.S. ethanol prices ended last week 1.7 percent higher and extended those gains in early week trading and rose 1.6 percent through Tuesday’s close. Midwest wholesale rack ethanol prices were higher to end last week and were up 0.3 percent through Tuesday’s market close to their last quote of 52.75 cents/liter (199.68 cents/gallon).
FOB Houston ethanol prices finished last week 0.4 percent higher and are up 0.8 percent through Tuesday’s trading from Friday’s close to their last quote of 52.34 cents/liter (198.13 cents/gallon). FOB Santos, Brazil anhydrous ethanol prices were lower last week; they are down in early week trading, falling 1.4 percent to 54.6 cents/liter (206.7 cents/gallon) through Tuesday’s close.
The FOB Gulf-Santos, Brazil ethanol spread has narrowed from last week’s close through Tuesday’s trading and is currently at -2.27 cents/liter (-8.57 cents/gallon).
MTBE prices fell 1.9 percent last week but were steady from Friday’s close through Tuesday’s trading. MTBE’s premium to FOB Houston ethanol has decreased from last week’s report and stands at 18.48 cents/liter (69.94 cents/gallon).
BTX component prices were sharply lower last week and were weaker still through Tuesday’s market close: Benzene was down 2.7 percent while Toluene was down 1.1 percent, and Xylene was down 1.3 percent. The estimated weighted average aromatic price is currently 89.1 cents/liter (337.29 cents/gallon), down from last Friday’s close. The BTX-Houston ethanol spread narrowed last week, and the weighted average BTX price is 36.76 cents/liter (139.16 cents/gallon) above FOB Houston values.
Gasoline and petroleum products were lower last week but pared those losses in early week trade. RBOB futures are up 1.1 percent to start the week while 84 octane RBOB (Houston) and 87 octane CBOB (U.S. Gulf) gasoline prices are up 1.7 and up 1.5 percent, respectively. WTI futures are 3.1 percent higher at $77.9/barrel while Brent futures are up 3.2 percent to $82.2/barrel, from Friday through Tuesday’s close.
Liquid tanker rates are 3 percent lower on average this week with offers for the U.S. Gulf to Brazil seeing the largest gains (up 0.1 percent). Freight from the U.S. Gulf to the East Coast of Mexico saw the largest declines and is down 25 percent from last week. On average, tanker freight from the U.S. Gulf is down 5 percent this week while freight from the PNW has posted a 1 percent decline. Liquid tanker freight rates from Brazil are unchanged, on average, this week. Freight rates across all origins are 38 percent higher than this same week in 2023.
Trends in C&F offers are diverging this week based largely on FOB price dynamics. Prices for ethanol FOB the U.S. Gulf are higher while offers for ethanol FOB the PNW and Brazil are 1.1 and 1.4 percent lower, respectively. Consequently, C&F offers from the U.S. Gulf are 0.9 percent higher this week as lower freight costs offset some of the increase in FOB values. Conversely, C&F values from the PNW and Brazil are down this week as weaker freight rates combine with lower FOB offers.
Prices for ethanol C&F to Central America from the U.S. Gulf are up 0.2 percent this week and are down 20.9 percent from this same week in 2023. Values for PNW ethanol C&F Southeast Asia average $797.99/MT this week, down 1.4 percent from the prior week and down 7.9 percent year-over-year. That compares to U.S. Gulf to Southeast Asia C&F prices that average $800.07/MT and are up 1.1 percent from last week but are down 16 percent year-over-year. C&F prices for Brazilian ethanol to Southeast Asia are down 1 percent from last week.
