Ethanol, Fuels and Co-Product Pricing
Market Outlook: U.S. ethanol prices ended last week 0.4 percent lower but gave back those gains in early week trading and fell 0.8 percent through Tuesday’s close. Midwest wholesale rack ethanol prices were lower to end last week but were up 0.8 percent through Tuesday’s market close to their last quote of 65.91 cents/liter (249.48 cents/gallon).
FOB Houston ethanol prices finished last week 1.2 percent lower but are up 1.3 percent through Tuesday’s trading from Friday’s close. FOB Houston ethanol prices are quoted at 65.03 cents/liter (246.15 cents/gallon). FOB Santos, Brazil anhydrous ethanol prices were lower last week; they are up in early week trading, rising 0.8 percent to 55.62 cents/liter (210.55 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 9.4 cents/liter (35.6 cents/gallon).
MTBE prices fell 9.5 percent last week and extended that weakness in early week trading to fall 9.4 percent from Friday’s close through Tuesday’s trading. MTBE’s premium to FOB Houston ethanol has decreased from last week’s report and stands at 21.87 cents/liter (82.78 cents/gallon).
BTX component prices were sharply lower last week and continued that trend through Tuesday’s market close: Benzene was down 2.6 percent while Toluene was down 4.7 percent, and Xylene was down 4.7 percent. The estimated weighted average aromatic price is currently 101.09 cents/liter (382.65 cents/gallon), down from last Friday’s close. The BTX-Houston ethanol spread narrowed last week, and the weighted average BTX price is 36.06 cents/liter (136.5 cents/gallon) higher than the FOB Houston ethanol price.
Gasoline and petroleum products were lower last week but are higher in response to conflict in the Middle East in early week trade. RBOB futures are up 3 percent to start the week while 84 octane RBOB (Houston) and 87 octane CBOB (U.S. Gulf) gasoline prices are up 2 and up 1.4 percent, respectively. WTI futures are 3.8 percent higher at $85.97/barrel while Brent futures are up 3.6 percent to $87.62/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 India seeing the largest gains (up 5 percent). Freight from the U.S. Gulf to the West Coast of Central America saw the largest declines and is down 19 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 4 percent increase. Liquid tanker freight rates from Brazil are down 0 percent, on average, this week. Freight rates across all origins are 7 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 down 0.2 percent this week and are down 2 percent from this same week in 2022. Values for PNW ethanol to Southeast Asia average $798.74/MT this week, up 1.2 percent from the prior week but down 10.9 percent year-over-year. That compares to U.S. Gulf to Southeast Asia C&F prices that average $943.7/MT and are up 1.2 percent from last week but are down 3.3 percent year-over-year. C&F prices for Brazilian ethanol to Southeast Asia are down 0.3 percent from last week.
