Ethanol, Fuels and Co-Product Pricing
Market Outlook: U.S. ethanol prices are lower to start the week, following last week’s mixed performance. Nearby CBOT ethanol futures are down 3.4 percent from Friday (when they finished the week up 0.8 percent) while Midwest wholesale rack ethanol prices are down 1.0 percent from Friday at 40.81 cents/liter (154.50 cents/gallon).
FOB Houston ethanol prices finished last week 2 percent lower and have continued that trend into this week’s trading. FOB Houston prices are down 1.3 percent from Friday at 40.92 cents/liter (154.9 cents/gallon), a decrease of 0.546 cents/liter (2.07 cents/gallon).
FOB Santos, Brazil ethanol prices ended last week 0.7 percent lower while this week’s prices have fallen another 0.8 percent. FOB Santos ethanol prices are currently 60.09 cents/liter, or 227.50 cents/gallon.
The FOB Houston-Santos spread widened 2.3 percent last week to -19.14 cents/liter (-72.44 cents/gallon) and is continuing that trend again so far this week. Prices show the spread widening 0.2 percent to -19.18 cents/liter (-72.60 cents/gallon). The spread seems to have entered a sideways trading pattern, after trending lower (wider) last fall and rebounding (narrowing) early this spring.
MTBE prices stabilized last week and are rebounding higher this week. Prices rose 0.6 percent higher by Friday’s close and are up 2.1 percent through Tuesday’s trading. MTBE prices are last quoted at 57.3 cents/liter (216.8 cents/gallon) and are valued at a 16.32 cents/liter premium (61.94 cents/gallon) premium to FOB Houston ethanol.
BTX component prices are mixed/lower to start the week, following last week’s continued weakness. Benzene prices finished last week down 1.8 percent and are down another 1.0 percent so far this week. Toluene prices slipped 2.3 percent last week but are 0.6 percent higher this week, while xylene prices fell 2.2 percent and 0.3 percent last week and this week, respectively. The estimated weighted average aromatic price is currently 69.25 cents/liter (262.14 cents/gallon), down 2.2 percent from last week. The weighted average BTX price is 28.33 cents/liter (107.24 cents/gallon) higher than FOB Houston ethanol prices.
Following last week’s sharp gain, gasoline and petroleum products are lower to start this week. RBOB futures are down 1.4 percent (0.73 cents/liter or 2.77 cents/gallon) while 84 octane RBOB and 87 octane CBOB are 1.1 and 1.5 percent lower, respectively. WTI crude oil futures are down $1.01/barrel from last week while Brent futures have lost $0.73/barrel.
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