Market and product
European fuel ethanol price hits four-month high
The prompt price was last higher on April 1 and hasn't gone through the Eur500/cu m level since May 23 when it was assessed at Eur502/cu m, according to Platts data.
Despite the recent uptick, ethanol has averaged lower prices throughout 2014.
The average price for the year so far is Eur476.61/cu m, Eur158.45/cu m lower than in the same period of 2013 when the average price was Eur635.06/cu m.
Grains-based producers across Northwest Europe have contended with negative estimated crush margins (when excluding revenue from by-products) for the majority of 2014 whilst maintaining output rates at high levels at the expense of a falling price. In recent weeks, an eventual shortage has led to a shortage in supply in the prompt barge market which has seen the price rebound from a four-year low of Eur433.50/cu m on July 22 to the four-month high Friday.
The shortage has been attributed to a cut in run rates and the sale of a sizable export cargo to India due to load in September which will clear nearly 30,000 cu m of Northwest European stocks.
Market sources believe prices to be sustained around current levels for the coming weeks as plants shut down for summer-maintenance to prepare for deliveries of fresh wheat and corn from 2014 harvest.
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