Ethanol, Fuels and Co-Product Pricing
Market Outlook: U.S. ethanol prices ended last week 2.8 percent higher and continued that trend in early week trading and rose 2.3 percent through Tuesday’s close. Midwest wholesale rack ethanol prices were higher to end last week and were up 1.3 percent through Tuesday’s market close to their last quote of 63.25 cents/liter (239.42 cents/gallon).
FOB Houston ethanol prices finished last week 3.6 percent higher and are up 1.2 percent through Tuesday’s trading from Friday’s close. FOB Houston ethanol prices are quoted at 61.19 cents/liter (231.63 cents/gallon). FOB Santos, Brazil anhydrous ethanol prices were higher last week; they are up in early week trading, rising 3.9 percent to 59.46 cents/liter (225.08 cents/gallon) through Tuesday’s trading.
The FOB Gulf-Santos, Brazil ethanol spread has narrowed from last week’s close through Tuesday’s trading and is currently at 1.73 cents/liter (6.55 cents/gallon).
MTBE prices rose 10.3 percent last week and rallied further still in early week trading to gain 5.2 percent from Friday’s close through Tuesday’s trading. MTBE’s premium to FOB Houston ethanol has increased from last week’s report and stands at 46.19 cents/liter (174.84 cents/gallon).
BTX component prices were higher last week but were mostly steady through Tuesday’s market close: Benzene was up 0.2 percent while Toluene was steady, and Xylene was also unchanged. The estimated weighted average aromatic price is currently 111.91 cents/liter (423.61 cents/gallon), up from last Friday’s close. The BTX-Houston ethanol spread narrowed last week, and the weighted average BTX price is 50.72 cents/liter (191.98 cents/gallon) higher than the FOB Houston ethanol price.
Gasoline and petroleum products were mostly lower last week and continued that weakness in early week trade. RBOB futures are down 2.8 percent to start the week while 84 octane RBOB (Houston) and 87 octane CBOB (U.S. Gulf) gasoline prices are down 3.4 and 2.7 percent, respectively. WTI futures are 1.9 percent higher at $81.36/barrel while Brent futures are up 1.1 percent to $84.91/barrel, from Friday through Tuesday’s close.
Liquid tanker rates are 1 percent lower on average this week with offers for the U.S. Gulf to Saudi Arabia seeing the largest gains (up 1 percent). Freight from the U.S. Gulf to the West Coast of Central America saw the largest declines and is down 7 percent from last week. On average, tanker freight from the U.S. Gulf is down 2 percent this week while freight from the PNW has posted a 1 percent decline. Liquid tanker freight rates from Brazil are down 0 percent, on average, this week. Freight rates across all origins are 9 percent lower than this same week in 2022.
On a cost-and-freight (C&F) basis, offers are mostly higher this week as higher FOB offers for ethanol offset lower freight rates. Prices for ethanol C&F to Central America from the U.S. Gulf are up 2.4 percent this week and are down 14.7 percent from this same week in 2022. Values for PNW ethanol to Southeast Asia average $826.74/MT this week, up 3.5 percent from the prior week but down 7.2 percent year-over-year. That compares to U.S. Gulf to Southeast Asia C&F prices that average $868.81/MT and are up 2.6 percent from last week but are down 17.7 percent year-over-year. C&F prices for Brazilian ethanol to Southeast Asia are up 1.1 percent from last week.
