Ethanol, Fuels and Co-Product Pricing
Market Outlook: U.S. ethanol prices ended last week 2.5 percent higher but reversed that trend in early week trading and fell 0.8 percent through Tuesday’s close. Midwest wholesale rack ethanol prices were higher to end last week and were up 0.7 percent through Tuesday’s market close to their last quote of 69.58 cents/liter (263.39 cents/gallon).
FOB Houston ethanol prices finished last week 3.4 percent higher but are unchanged through Tuesday’s trading from Friday’s close. FOB Houston ethanol prices are quoted at 68.03 cents/liter (257.53 cents/gallon). FOB Santos, Brazil anhydrous ethanol prices were lower last week; they are down in early week trading, falling 0.9 percent to 61.32 cents/liter (232.105 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 6.72 cents/liter (25.43 cents/gallon).
MTBE prices rose 5.8 percent last week and extended those gains in early week trading to gain 3.9 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 4.08 cents/liter (15.46 cents/gallon).
BTX component prices were higher last week and strengthened through Tuesday’s market close: Benzene was up 2.4 percent while Toluene was up 0.8 percent, and Xylene was up 0.8 percent. The estimated weighted average aromatic price is currently 95.35 cents/liter (360.93 cents/gallon), up from last Friday’s close. The BTX-Houston ethanol spread widened last week, and the weighted average BTX price is 27.31 cents/liter (103.39 cents/gallon) higher than the FOB Houston ethanol price.
Gasoline and petroleum products were higher last week but are weaker in early week trade. RBOB futures are down 4.5 percent to start the week while 84 octane RBOB (Houston) and 87 octane CBOB (U.S. Gulf) gasoline prices are down 3.8 and 4.6 percent, respectively. WTI futures are 6 percent lower at $68.3/barrel while Brent futures are down 5.8 percent to $72.53/barrel, from Friday through Tuesday’s close.
Liquid tanker rates are 2 percent lower on average this week with offers for Brazil to India 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 3 percent this week while freight from the PNW has posted a 2 percent decline. Liquid tanker freight rates from Brazil are down 1 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 1.6 percent this week and are down 12.2 percent from this same week in 2022. Values for PNW ethanol to Southeast Asia average $864.51/MT this week, down 1 percent from the prior week and down 23.6 percent year-over-year. That compares to U.S. Gulf to Southeast Asia C&F prices that average $973.5/MT and are up 1.5 percent from last week but are down 8.6 percent year-over-year. C&F prices for Brazilian ethanol to Southeast Asia are down 0.5 percent from last week.