Ethanol Market Prices Narrowly Weaken

August 8th News

According to the commodity market analysis system, from August 4 to 7, the price of ethanol in China fell to 5,660 CNY/ton, with a decrease of 0.29% during the period. The price increased by 0.14% month-over-month but decreased by 5.78% year-over-year. The ethanol market prices in China were weak, with limited overall market transactions, and factory quotations declined.

Cost Aspect: Regarding costs, the spot price of corn continues to trend weaker. Accompanied by a decline in futures prices, the overall market buying and selling atmosphere is relatively weak. Traders in producing areas have slightly increased their willingness to sell, but downstream buyers remain somewhat cautious. Ethanol production costs are influenced by bearish factors.

On the supply side, operating rates of fuel ethanol plants remained relatively stable, with increases in supply exceeding decreases. The Wanli plant resumed normal operations, while the Hongzhan Lahah anhydrous ethanol plant and the Fukan plant also resumed production. However, the Yushu plant was completely shut down, and the Shandong Qufeng plant was also fully offline. Other plants in East China continued stable operations, while the COFCO plant in Guangxi, South China, was shut down. Overall, the impact on ethanol supply was mixed.

Demand side: From the demand perspective, many liquor factories in some regions have already halted production, resulting in limited transactions, mostly consumed by the chemical industry. The ethanol demand side is influenced by bearish factors.

Market forecast: Factory quotations remain stable, with transactions occurring at lower levels, and high-priced goods facing difficulties in being sold. Ethanol analysts expect the short-term ethanol market to mainly operate under weak conditions.