Ethanol, Fuels and Co-Product Pricing
Market Outlook: U.S. ethanol prices ended last week 1.1 percent higher but erased those gains in early week trading and fell 2.2 percent through Tuesday’s close. Midwest wholesale rack ethanol prices were lower to end last week but were up 0.4 percent through Tuesday’s market close to their last quote of 52.48 cents/liter (198.67 cents/gallon).
FOB Houston ethanol prices finished last week 2.1 percent lower but are up 0.8 percent through Tuesday’s trading from Friday’s close. FOB Houston ethanol prices are quoted at 51.71 cents/liter (195.74 cents/gallon). FOB Santos, Brazil anhydrous ethanol prices were lower last week; they are down in early week trading, falling 1.8 percent to 56.7 cents/liter (214.62 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 -4.99 cents/liter (-18.88 cents/gallon).
MTBE prices fell 1.5 percent last week but reversed that weakness in early week trading to gain 1 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 21.27 cents/liter (80.52 cents/gallon).
BTX component prices were sharply lower last week and were lower again in tandem with broader energy market weakness through Tuesday’s market close: Benzene was down 1 percent while Toluene was down 1.2 percent, and Xylene was down 0.9 percent. The estimated weighted average aromatic price is currently 85.99 cents/liter (325.5 cents/gallon), down from last Friday’s close. The BTX-Houston ethanol spread narrowed last week, and the weighted average BTX price is 34.28 cents/liter (129.77 cents/gallon) higher than the FOB Houston ethanol price.
Gasoline and petroleum products were lower last week but scored shallow gains in early week trade. RBOB futures are up 0.9 percent to start the week while 84 octane RBOB (Houston) and 87 octane CBOB (U.S. Gulf) gasoline prices are up 0.5 and up 0.3 percent, respectively. WTI futures are 1.1 percent higher at $74.36/barrel while Brent futures are up 1.1 percent to $77.68/barrel, from Friday through Tuesday’s close.
Liquid tanker rates are mostly steady this week with offers for the U.S. Gulf to the West Coast of Central America seeing the largest gains (up 3 percent). Freight from the U.S. Gulf to the East Coast of Mexico saw the largest declines and is down 6 percent from last week. On average, tanker freight from the U.S. Gulf is down 1 percent this week while freight from the PNW has posted a 1 percent increase. Liquid tanker freight rates from Brazil are steady, on average, this week. Freight rates across all origins are 2 percent lower than this same week in 2023.
On a cost-and-freight (C&F) basis, offers are mixed with ethanol originating in the Gulf seeing mild pricing strength while offers from the PNW and Brazil are slightly lower. Prices for ethanol C&F to Central America from the U.S. Gulf are up 0.5 percent this week and are down 16.4 percent from this same week in 2023. Values for PNW ethanol to Southeast Asia average $788.37/MT this week, down 1.5 percent from the prior week and down 7.2 percent year-over-year. That compares to U.S. Gulf to Southeast Asia C&F prices that average $747.92/MT and are up 0.6 percent from last week but are down 15.4 percent year-over-year. C&F prices for Brazilian ethanol to Southeast Asia are up 0.1 percent from last week.
