Ethanol Market and Pricing Data – December 26, 2017

1. Ethanol, Fuels and Co-Product Pricing

Market Outlook: U.S. ethanol prices are sagging to start the post-Christmas holiday week as buying interest remains slow. January CBOT ethanol futures are slightly lower in early week trading while February, March and later futures are higher. National average rack and ethanol blended gasoline prices are steady through Tuesday’s trading. Wholesale rack prices were last quoted at 37.18 cents/liter (140.76 cents/gallon), down just 0.3 percent from last week.

FOB Houston ethanol prices ended last week down 3.7 percent at 35.478 cents/liter (134.3 cents/gallon). In Tuesday’s low volume trading, prices increased 0.7 percent to 35.72 cents/liter (135.2 cents/gallon), following gains in the U.S. domestic markets and higher gasoline prices. FOB Santos, Brazil ethanol prices finished the pre-Christmas week lower as well, losing 1.517 cents/liter (5.74 cents/gallon or 2.6 percent) to end at 56.843 cents/liter (215.175 cents/gallon). Prices are firmer to start the current week, with FOB Santos prices last quoted 0.4 percent higher at 57.07 cents/liter (216.04 cents/gallon).

The Houston-Santos spread increased slightly from last week’s six-month low, with the spread last quoted at -21.346 cents/liter (80.804 cents/gallon). The spread is only 16 cents/gallon away from its five-year lows of -$1.115/gallon and is approximately three times as wide as its five-year average value of -$0.366/gallon.

MTBE prices bounced 3.3 percent higher last week, rising to 51.94 cents/liter (196.66 cents/gallon), but are only slightly higher (0.15 percent) to start this week. FOB Houston MTBE is priced 16.459 cents/liter (62.30 cents/gallon) above FOB Houston ethanol in early week trading.

BTX component prices finished last week with mixed performance as benzene lost 2.9 percent while toluene prices rose 0.8 percent and Xylene prices gained 0.6 percent. The weighted average aromatic price is currently estimated at 64.69 cents/liter ($2.4498/gallon), down 0.3 percent from last week. The weighted average BTX price is 28.99 cents/liter (109.74 cents/gallon) higher than FOB Houston ethanol prices.

Gasoline and petroleum products are higher in early-week trading. RBOB futures rose 1.78 percent on a recovery in the broader energy markets but cash RBOB and CBOB (FOB Houston) each slightly lower in Tuesday’s trading but up more than 1 percent Wednesday morning. WTI and Brent crude oil futures were both over $1/barrel higher to start the week on Tuesday, with WTI closing at $59.97/barrel and Brent at $67.02/barrel.