Ethanol, Fuels and Co-Product Pricing
Market Outlook: U.S. ethanol prices ended last week 0.6 percent lower and were on the defensive to start the new year. Ethanol prices extended last week’s losses in early week trading and fell 4.4 percent through Tuesday’s close. Midwest wholesale rack ethanol prices were lower to end last week and were down 1.1 percent through Tuesday’s market close to their last quote of 47.08 cents/liter (178.22 cents/gallon).
FOB Houston ethanol prices finished last week 1.8 percent higher but are down 3.5 percent through Tuesday’s trading from Friday’s close. FOB Houston ethanol prices are quoted at 44.73 cents/liter (169.32 cents/gallon). FOB Santos, Brazil anhydrous ethanol prices were lower last week; they are down in early week trading, falling 1.2 percent to 49.07 cents/liter (185.76 cents/gallon) through Tuesday’s trading.
The FOB Gulf-Santos, Brazil ethanol spread has widened from last week’s close through Tuesday’s trading and is currently at -4.34 cents/liter (-16.44 cents/gallon).
MTBE prices rose 3.5 percent last week and firmed in early week trading to gain 0.2 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 22.01 cents/liter (83.3 cents/gallon).
BTX component prices were higher last week but turned defensive in early week trade through Tuesday’s market close: Benzene was down 1.1 percent while Toluene was up 0.2 percent, and Xylene was up 0.2 percent. The estimated weighted average aromatic price is currently 89.09 cents/liter (337.25 cents/gallon), up from last Friday’s close. The BTX-Houston ethanol spread widened last week, and the weighted average BTX price is 44.36 cents/liter (167.93 cents/gallon) higher than the FOB Houston ethanol price.
Gasoline and petroleum products were lower last week and were steady/lower in early week trade. RBOB futures are down 0.5 percent to start the week while 84 octane RBOB (Houston) and 87 octane CBOB (U.S. Gulf) gasoline prices are down 0.1 and unchanged, respectively. WTI futures are 1.8 percent lower at $70.38/barrel while Brent futures are down 1.2 percent to $76.1/barrel, from Friday through Tuesday’s close.
Liquid tanker rates are 1 percent higher on average this week with offers for the U.S. Gulf to India seeing the largest gains (up 7 percent). Freight from the U.S. Gulf to the East Coast of Mexico saw the largest declines and is down 14 percent from last week. On average, tanker freight from the U.S. Gulf is up 1 percent this week while freight from the PNW has posted a 5 percent increase. Liquid tanker freight rates from Brazil are up 1 percent, on average, this week. Freight rates across all origins are 12 percent lower than this same week in 2023.
On a cost-and-freight (C&F) basis, offers are mostly lower this week as lower FOB offers for ethanol have offset gains in liquid tanker freight rates. Prices for ethanol C&F to Central America from the U.S. Gulf are down 3.3 percent this week and are down 25.2 percent from this same week in 2023. Values for PNW ethanol to Southeast Asia average $701.09/MT this week, down 0.5 percent from the prior week and down 24.8 percent year-over-year. That compares to U.S. Gulf to Southeast Asia C&F prices that average $667.46/MT and are down 2.3 percent from last week and are down 27.7 percent year-over-year. C&F prices for Brazilian ethanol to Southeast Asia are down 0.1 percent from last week.
