Brazil exported 46.9 million liters of ethanol to Europe in October, the most it had exported to the region on a monthly basis since October 2010, data from the Secretariat of Foreign Trade (SECEX) showed Monday.
Of that total, 33.6 million liters headed to the Netherlands and 13.3 million liters were exported to the UK. The remainder -- 24,700 liters -- was sent to Belgium.
Overall, Brazilian exports in October totaled 260 million liters, SECEX data show, up 49.5% from September and more than double that of October 2014.
The surge in exports is due to recent European ethanol tightness, according to sources. It has not been confirmed how much product is for fuel or industrial usage, but according to Platts data, the ethanol exported is the anhydrous grade, which contains less water and it can be mixed with gasoline.
In the first 10 months of 2015, Brazilian ethanol exports to Europe totaled 63.7 million liters, compared with nearly 13 million liters exported in the whole of 2014. Total exports in 2014 were the lowest recorded since ethanol exports kicked into a higher gear in 2006.
The all-time high was seen in 2008, when Brazil exported 1.49 billion liters to Europe. At that time, Brazilian ethanol exports reached the all-time record of 5.07 billion liters.
During the first 10 months of 2015, Brazilian ethanol exports totaled 1.385 billion liters, up 18% from same period a year ago. The main factors boosting exports were the Brazilian FOB price's competitiveness due to the Brazilian real's weakness against the US dollar combined with lower domestic ethanol prices during the 2015-16 sugarcane season.
The export trend is likely to change in the short term as FOB ethanol values in Brazil surged in October following the recent hike in domestic prices, according to Platts analysis. The Platts anhydrous FOB Santos/Paranagua assessment averaged $493/cu m in October, up 19% from September but down 17% from October 2014.
Domestic prices have increased because of the 6% increase in ex-refinery gasoline prices announced in late September; fewer hydrous ethanol offers in the spot market, as producers are building stocks for the intercrop season; and recent rain in the region hampering the pace of harvest.
Kingsman estimated that exports should reach 1.55 billion liters in 2015, up 11% compared with 1.4 billion liters exported in 2014.
