For the Quarter Ending June 2025
North America
• North American Ethanol Price Index increased by 1% over Q1 2025 but eventually had a downward trend throughout Q2, with quarterly average valued at USD 593/MT, 99% FOB Texas, as the market weakened despite initial-quarter strength.
• Early price resiliency was underpinned by stable ethanol production cost patterns fueled by strong Midwest operating levels and robust plant efficiencies, especially in May when production rebounded to 1.056 million bpd.
• Nevertheless, oversupply worries increased as ethanol production reached an all-time high of 1.12 million bpd in early June, ahead of domestic and export demand, prompting downward revisions in the Ethanol Price Index at the end of the quarter.
• Ethanol demand outlook remained uneven throughout the quarter, with blending activity faltering mid-quarter due to regional slowdowns and weak gasoline consumption trends, though late-quarter East Coast demand showed mild recovery.
• Exports fluctuated, spiking in May but softening in June, adding to inventory overhangs; despite falling blender inputs, inventories remained historically elevated, reinforcing the bearish pressure on the Ethanol Price Index.
• The slight increase in Ethanol prices forecasted for July 2025 is likely to be driven by a combination of seasonal uptick in gasoline blending, tighter stock draws due to reduced output, and firm international buying interest after tariff-related trade disruptions stabilize.
• Ethanol Price Forecast indicates a cautiously bullish trend for July, contingent on continued moderation in production and improvement in domestic blending demand post-Q2 stagnation.
• Feedstock costs stayed moderate as corn futures remained subdued, offering stable ethanol production cost trends, though flat USDA projections for ethanol-use corn limited upside support from agricultural fundamentals.
• Why did the price change in July 2025? The Ethanol Price Index is expected to rise in July 2025 due to seasonal gasoline blending recovery, reduced output tightening stock levels, and a potential rebound in export demand following tariff-related trade adjustments.
• In summary, Q2 witnessed an early uptick followed by a declining Ethanol Price Index due to oversupply, soft blending, and export volatility, while July 2025 holds potential for a mild rebound as domestic consumption steadies and production tightens.
APAC
• In Q2 2025, India’s Ethanol Price Index averaged USD 955/MT, Ex-Delhi NCR, reflecting a 0.5% decline from Q1 2025, with a mixed trend across the quarter—prices rose during early April and early May, then softened by late May and June.
• The Ethanol Price Index initially climbed on improved blending rates and increased government approvals for grain-based supply (e.g., 5.2 million tonnes of FCI rice), but later declined due to regional policy inconsistencies, added levies, and surplus output from new distilleries.
• Weak policy clarity, especially around post-E20 blending goals, further pressured prices in June, alongside cost burdens from state-level charges in Punjab, Haryana, and Uttar Pradesh, straining the economics of grain ethanol producers.
• Why did the price change in July 2025? Ethanol prices in India are forecasted to rise as summer blending demand intensifies, policy clarity supports grain-based supply economics, and improved plant utilization aligns with stronger maize procurement and firmer global oil prices.
• Throughout Q2, Ethanol Demand Outlook remained steady, anchored by the EBP Programme nearing its 20% blending target, with demand driven by oil marketing companies and stable procurement from the transport, industry, and food sectors.
• While ethanol production cost trend was broadly stable due to government subsidies and diverse feedstock availability (including maize, broken rice, and stubble), state-imposed fees and logistical disruptions raised localised production costs.
• Grain-based ethanol gained share over sugarcane-based variants, supported by government support and concerns over water-intensive sugarcane, especially in Maharashtra and Karnataka following poor 2023 monsoons.
• Investments in distilleries like Zuari’s upcoming 180 KLPD plant and Amul’s dairy-waste-based ethanol projects reflected rising long-term confidence, although utilisation gaps persisted due to pricing and feedstock volatility.
• Ethanol Price Forecast for July 2025 points to a likely increase, driven by higher summer blending demand, improved plant efficiency, and anticipated policy clarity favouring grain-based ethanol; maize procurement from key states and rising oil prices may also support prices.
Europe
• Ethanol Price Index in Germany declined 2% in Q2 2025 compared to Q1 2025, with the quarterly average assessed at USD 726/MT, FD Frankfurt, reflecting soft demand fundamentals and logistics-driven supply volatility.
• Why did the price change in July 2025? Ethanol prices in Germany are predicted to climb in July 2025, driven by stricter GHG reduction mandates, reduced certificate carryover allowances, and ongoing logistics bottlenecks—especially rail disruptions near Hamburg—limiting short-term supply.
• The Ethanol Price trend showed mixed movements across the quarter, initially retreating due to subdued demand in early April, stabilizing in May amid port disruptions and then recovering slightly by late June as regulatory compliance boosted blending volumes.
• The Ethanol Demand Outlook remained subdued for most of Q2; fuel blending saw a temporary dip during early spring due to cooler weather and muted gasoline consumption, while industrial and beverage-grade usage held steady but failed to drive price support.
• The Ethanol Production Cost Trend remained elevated throughout Q2, driven by high wheat and corn input prices, further impacted by poor harvests in parts of Europe and energy-related inflation in the early weeks, although easing slightly by end-June.
• Port congestion and rail transport disruptions, especially at Hamburg and Bremerhaven, persisted through Q2, causing occasional delays in imports and domestic distribution, though strategic stock management helped stabilize local supply conditions.
• Imports from the Americas and intra-EU flows remained active, helping meet domestic demand despite infrastructural bottlenecks; however, market sentiment was dampened by concerns over potential tariff circumvention via UK-U.S. ethanol trade flows.
• Ethanol Price Forecast for July 2025 indicates a likely increase, supported by the implementation of stricter GHG reduction mandates and the phasing out of certificate carryovers, which is expected to boost ethanol blending demand and strain supply.
• The Q2 trend reflects a well-supplied but cautious market environment, with the Ethanol Price Index being relatively stable despite macroeconomic uncertainty and downstream buyers adopting hand-to-mouth purchasing strategies.
• July 2025 may also see upward pressure on the Ethanol Price Index due to higher Ethanol Production Cost Trend and ongoing logistical constraints, particularly linked to scheduled rail closures at Hamburg’s Waltershof terminal.
South America
• Ethanol Price Index in Brazil declined 3% from Q1 2025, with Q2 assessed at USD 704/MT, Anhydrous FOB Santos, reflecting a mixed trend—initial increases in April followed by sustained downward corrections through June.
• Why is did the price change in July 2025? Ethanol prices in Brazil are set to increase due to the government's confirmed hike in the national ethanol blending mandate from 27% to 30%, which is expected to tighten the supply-demand balance and enhance blending economics ahead of the policy’s August rollout.
• Early in Q2, Ethanol Price rose on the back of robust sugarcane crushing and surging corn ethanol output, supported by policy discussions to raise the national ethanol blend from 27% to 30%, reinforcing positive sentiment in the Ethanol Demand Outlook.
• Strong corn-based ethanol production, especially in Mato Grosso and Goiás, and improved logistics, including new pipeline and rail infrastructure, temporarily tightened supply, lifting the Ethanol Price Index to a peak of USD 748/MT in mid-May.
• However, from late May onward, prices began to ease due to higher inventory levels, weaker hydrous ethanol demand, and logistical backlogs at key ports. Export volumes remained steady but were insufficient to offset slack domestic consumption.
• Ethanol Production Cost Trend remained elevated due to early-season feedstock competition, but efficient distillery operations and scale-up in DDGS by-product exports to China offered some cost mitigation and long-term upside.
• Domestic Ethanol Demand Outlook was pressured by limited pump price advantage over gasoline, lagging hydrous sales, and subdued economic activity; retail fuel sales dipped year-on-year in several states, notably in the Northeast.
• Brazil’s growing push into DDGS exports and corn ethanol infrastructure signaled strategic market diversification but marginally redirected focus from ethanol, easing tightness in Q2 and contributing to price softness by end-June.
• Ethanol Price Forecast for July 2025 indicates an increase, driven by the Brazilian government’s confirmed decision to implement a higher 30% ethanol blend mandate from August 1, 2025. This policy will likely tighten supply-demand dynamics and improve blending economics, lifting the Price Index in the near term.
For the Quarter Ending March 2025
North America
During the first quarter of 2025, the U.S. ethanol market witnessed a mix of bullish and bearish influences, leading to fluctuations in prices over the three-month period. January commenced with a firm price outlook, largely supported by strong export demand and tightening domestic production. While domestic blending demand showed signs of weakness, significant export growth absorbed excess supply, balancing the market. Inventory levels remained elevated, signaling sufficient availability, though the absence of imports underscored a reliance on domestic production.
In February, ethanol prices maintained an upward trajectory through the mid-month mark, supported by resilient international demand, particularly from Canada and the European Union. However, by month-end, the market experienced a modest pullback. Increased production, a surge in stock levels, and stable blending demand created a well-supplied environment, softening price sentiment despite continued export activity.
March brought greater volatility. Early in the month, prices declined due to weakening domestic demand, growing inventories, and a downward revision in the EIA's production outlook. However, a late-month recovery emerged as production dipped and exports surged, notably tightening domestic availability. Blending activity strengthened, particularly in the Midwest, contributing to upward price momentum toward the quarter’s end.
Overall, Q1 2025 was characterized by dynamic shifts in production, trade flows, and policy signals. Strong exports and policy support provided upward pressure, while ample inventories and inconsistent blending demand occasionally moderated price gains. The market's performance reflected a delicate balance between global and domestic demand forces, production trends, and regulatory developments. The quarter ended with a 7% increase in prices compared to the previous quarter.
APAC
The ethanol market in the APAC region during Q1 2025 saw a mixed trend, characterized by slight price fluctuations driven by varying regional dynamics. In China, prices generally exhibited an upward trajectory early in the quarter, supported by steady demand from industrial sectors such as Baijiu production and fuel ethanol blending. However, by February, price movements slowed as the market showed signs of stability, with some regions like Shandong facing weaker demand, leading to minor price corrections. Logistical issues, including those during the Chinese New Year, further impacted supply chains, but overall, the market remained well-supplied. Despite tight production margins due to rising raw material costs, such as corn, supply disruptions were minimal, and production continued at normal levels. By March, the market showed a more stable outlook, with prices consolidating at higher levels. The overall demand remained steady, supported by regular procurement from key industries, though price changes were mostly influenced by production costs and logistical conditions rather than significant shifts in demand. The quarter ended with price stability across major markets in the region. However, the quarter ended with a 6% decrease in prices compared to the previous quarter.
South America
The ethanol market in South America, particularly Brazil, experienced a mixed trend during Q1 2025, with price fluctuations driven by a combination of domestic and international factors. Early in the quarter, prices rose due to a robust domestic demand supported by increased production of corn-based ethanol, which accounted for a significant portion of the total output. This surge in production helped offset the reduced sugarcane processing levels, resulting in a balance between supply and demand. The Brazilian government’s decision to expand ethanol blending mandates further fueled domestic demand, while exports, especially to Asia and Europe, saw a marked increase, supporting price growth.
However, as the quarter progressed, particularly in February and March, prices faced downward pressure. This was largely due to rising inventories and increased ethanol supply, particularly from the corn sector. Domestic demand weakened, particularly for hydrous ethanol, as fuel distributors anticipated further price drops. Additionally, the slowing pace of ethanol sales during the post-Carnival period added to the bearish sentiment. The export market showed some stability, but competition from other ethanol-producing countries and uncertainties surrounding trade policies, especially with the U.S., introduced some volatility. Despite these challenges, Brazil's continued investments in ethanol infrastructure and the country's key role in global biofuel markets provided optimism for the medium to long term. The quarter ended with a 9% increase in prices compared to the previous quarter.
Europe
The ethanol market in Europe experienced a mixed trend during Q1 2025, with fluctuating prices driven by a combination of regulatory changes, supply chain disruptions, and shifting demand patterns. Early in the quarter, prices rose due to the stricter renewable fuel standards implemented by Germany, along with an increase in greenhouse gas (GHG) quotas for 2025. The regulatory focus on higher GHG savings ethanol, particularly driven by the suspension of carried-forward certificates, led to increased demand for ethanol products with high GHG savings. However, these price increases were also influenced by supply-side challenges, such as adverse weather conditions that impacted feedstock availability, particularly wheat and corn. The reduced availability of these key feedstocks raised production costs, which in turn supported the upward price trend.
As the quarter progressed, logistical disruptions, particularly congestion at major European ports and rail delays, added pressure to the supply chain. These issues contributed to occasional price hikes, but as demand from the biofuel sector weakened post-winter and blending activity slowed, ethanol prices began to stabilize. The seasonal drop in fuel consumption and reduced industrial demand, particularly from the chemical and pharmaceutical sectors, softened the market. Additionally, sufficient supply from imports, including increased shipments from neighboring EU countries, helped to maintain price stability. Despite these fluctuations, the overall trend saw a moderation in ethanol prices towards the end of Q1, as supply levels remained relatively balanced and demand from both the fuel and industrial sectors showed signs of stabilization.
The quarter ended with a 6% increase in prices compared to the previous quarter.
For the Quarter Ending December 2024
North America
In Q4 2024, the U.S. ethanol market displayed significant price fluctuations, marked by a strong upward trend in the early part of the quarter, followed by a decline as the quarter progressed. Initially, in October, prices remained stable, supported by consistent demand from the fuel blending sector and industrial usage of ethanol as a feedstock. Domestic production was aligned with demand, as U.S. ethanol producers-maintained output levels matching consumption, preventing supply imbalances. A favorable market dynamic, alongside strong export performance, particularly in October, saw exports surge by 38% compared to the previous week. This upward export momentum helped stabilize prices despite slight drops in ethanol inventories.
By mid-November, ethanol production reached record highs of 1.113 million barrels per day, fueled by robust domestic output and a steady increase in regional production, particularly in the Midwest. Despite this growth in supply, the global demand for ethanol remained strong, driving prices upward in late November. However, blending activity began to show signs of slight weakening as production continued to outpace demand. Ethanol inventories also rose, contributing to downward price pressure.
In December, the market saw a marked decline in ethanol prices. A decrease in export demand, coupled with growing ethanol inventories, signaled an oversupplied market. Additionally, a slight dip in production and blending activity further exacerbated the downward price movement. Despite these trends, domestic demand remained stable, with a marginal increase in blending activity observed during the month. However, the decline in ethanol exports and reduced regional consumption, especially in the Gulf Coast and Midwest, contributed to the overall softening of prices.
Overall, Q4 2024 saw a volatile price trend, with prices rising sharply in October and November due to strong demand and production growth. However, December experienced a price decline as supply outpaced demand. The quarter ended with a 13% decrease in prices compared to the previous quarter.
APAC
In the APAC region, particularly in China, the ethanol market exhibited a declining trend throughout Q4 2024, driven by supply surpluses, fluctuating demand, and market adjustments. Early in the quarter, prices softened due to a seasonal demand slowdown and increased domestic production, supported by improved plant efficiencies and stable feedstock availability. Corn prices, a key determinant of ethanol production costs, experienced consistent declines, further pressuring ethanol prices downward.
Midway through the quarter, market stability was briefly observed, with steady demand from fuel blending industries and industrial sectors, coupled with effective inventory management. However, this stabilization was short-lived as the market faced mounting supply pressures. Increased production capacity and weak enforcement of biofuel mandates, alongside a drop in export demand, created a surplus environment that reinforced the downward price trend.
By the latter part of the quarter, limited procurement enthusiasm and rising inventories further weighed on the market. Although certain industrial and biofuel blending applications supported baseline demand, overall consumption remained muted. These combined factors resulted in a sustained decline in ethanol prices across Q4 2024. Overall, the quarter-on-quarter change decreased, with prices decreasing by 8% compared to the previous quarter.
Europe
In Q4 2024, the price trend of ethanol in Europe, particularly in Germany, displayed a clear two-phase movement, with an incline in the first half of the quarter and a decline in the latter half. The first phase, spanning October and early November, saw a noticeable rise in prices driven by strong demand from the fuel blending industry, especially with colder weather increasing ethanol-blended fuel consumption. Additionally, supply constraints due to plant shutdowns and technical issues in production facilities further tightened the market, pushing prices higher. The seasonality of demand and the growing emphasis on renewable fuels, coupled with some import difficulties, supported this price increase.
However, in the second half of November and into December, prices softened. The decline in ethanol prices was primarily due to weakened demand from industrial and fuel sectors, exacerbated by a slowdown in manufacturing activity across the Eurozone. This was further compounded by increased supply from competing international sources, particularly from Brazil, because of the EU-Mercosur trade deal. As a result, the ethanol market saw oversupply pressures, causing prices to decrease despite stable blending mandates.
Overall, Q4 2024 experienced volatility in ethanol prices in Germany, with a strong upward momentum in the first half of the quarter followed by a softening in the latter part. With the price decline towards the end of the quarter, the quarter-on-quarter change of 12% indicated an overall decrease in prices.
South America
In South America, particularly Brazil, ethanol prices exhibited a mixed trend during Q4 2024. The first half of the quarter saw an upward trend, followed by a decline in the latter half, influenced by varying production and demand dynamics.
During the initial weeks of Q4, stable sugarcane prices and increased ethanol output supported steady market conditions. Ethanol production from both sugarcane and corn saw significant growth, driven by high demand for biofuels, including hydrous ethanol used for blending purposes. Regulatory developments, such as the “Fuel of the Future” law and increased blending mandates, also bolstered demand. The inauguration of new production capacities, including Brazil’s largest corn-based ethanol plant, further added to supply stability. Ethanol prices climbed as supply could not immediately meet the strong domestic consumption, particularly for hydrous ethanol, pushing prices upward.
In contrast, the second half of the quarter experienced a price decline, primarily driven by reduced sugarcane processing, slower ethanol production, and rising inventory levels. Despite robust domestic sales, particularly of hydrous ethanol, global market trends, declining crude oil prices, and softening demand exerted downward pressure on prices. By December, ethanol prices had closed lower, marking a 6% decrease compared to the previous quarter, reflecting the interplay of balanced supply-demand dynamics and external market influences.
For the Quarter Ending September 2024
North America
In the North American region during Q3 2024, the Ethanol market experienced a significant decline in prices. This downward trend was primarily influenced by a combination of factors such as surplus production capacity, and inventory adjustments by producers.
Seasonal slowdowns in demand for ethanol-blended fuels and a temporary dip in industrial consumption further exacerbated the situation. Corn prices, a key input for ethanol production, decreased, lowering production costs and facilitating lower selling prices. These elements led to an oversupply of Ethanol in the market, resulting in decreased prices. Additionally, reduced industrial demand and lower blending activity further contributed to the negative pricing environment.
Specifically in the USA, which saw the most notable price changes, the overall trend for Ethanol prices in Q3 2024 was characterized by a consistent decrease. Furthermore, the quarter-on-quarter change of 4% indicated a gradual decrease in prices. The price variation between the first and second half of the quarter, with a decrease of 7%, demonstrated a continued downward trajectory. Ultimately, the quarter-ending price of USD 535/MT of Ethanol 99% FD Houston in the USA reflected the prevailing negative pricing sentiment and the challenging market conditions for Ethanol producers.
APAC
In Q3 2024, ethanol prices in the APAC region exhibited overall stability, driven by various factors. In China, prices experienced a slight increase, supported by stable demand and supply constraints. At the start of the quarter, rising blending mandates and consistent production levels in downstream sectors such as chemicals and pharmaceuticals bolstered ethanol demand. Although domestic production remained steady, unexpected plant shutdowns and technical issues temporarily limited supply, contributing to upward price pressure. Fluctuations in raw material costs, particularly for corn, also affected production expenses. As the quarter progressed, price stability was maintained due to a seasonal uptick in demand for ethanol-blended fuels and effective inventory replenishment. The government's strict blending mandates reinforced the demand for ethanol as a renewable fuel source. By late Q3, China's ethanol market demonstrated resilience, effectively navigating internal production challenges and external economic pressures to ensure consistent pricing. Overall, the quarter-on-quarter change remained unchanged, with prices increasing slightly by 1% compared to the first half of the quarter. The quarter-ending price for ethanol Ex-Shanghai stood at USD 727/MT, highlighting the overall stable pricing environment.
Europe
In Q3 2024, ethanol prices in the European region faced a significant downturn, driven by a combination of factors. Increased domestic production, bolstered by enhanced plant efficiencies, led to a market surplus. Concurrently, imports surged from Poland, France, and Belgium, further saturating supply in Germany. Seasonal demand fluctuations played a crucial role, as reduced consumption from sectors such as chemicals and pharmaceuticals added to the downward pressure on prices. The economic landscape also shifted, with Germany experiencing a GDP contraction of 0.1% in Q2, impacting overall demand. The USDA projected an increase in U.S. corn supplies for 2024-2025; however, reduced foreign production in the EU and Russia raised concerns about potential ethanol supply challenges. These factors collectively contributed to a bearish market sentiment, resulting in lower ethanol prices across the region. Freight charges in Europe were another critical influence on the market. Rates from Asia to Northern Europe declined by 2%, while the Asia-Mediterranean route saw a 3% drop. This decrease stemmed from improved carrier capacity and a shift away from peak season demand. However, persistent congestion at major Asian ports and delays caused by incidents like the explosion at the Port of Ningbo complicated shipping schedules. Overall, the quarter-on-quarter change recorded an increase of 3%, but a price comparison between the first and second halves of the quarter showed a decline of 6%, emphasizing the overall negative pricing trends. The quarter-ending price for ethanol FD Frankfurt stood at USD 730/MT.
South America
In Q3 2024, the South American region experienced mixed Ethanol pricing environment, with significant factors influencing market prices. In the first half of Q3 2024, Brazil experienced a notable increase in ethanol prices, driven by robust domestic demand and production constraints. The government's raised blending mandate spurred demand, while technical issues and maintenance shutdowns at ethanol facilities limited supply. Additionally, adverse weather conditions delayed sugarcane harvesting, impacting production levels. As a result, ethanol production surged up to 21% from the previous year, yet tight supply dynamics led to reliance on spot purchases, further elevating prices. During the second half of Q3 2024, ethanol prices in Brazil declined driven by a seasonal slowdown in demand for ethanol-blended fuels and reduced industrial usage. Despite a temporary reduction in sugarcane processing total ethanol production rose, bolstered by a 14 % increase in corn ethanol output. Enhanced domestic production and inventory adjustments led to a market surplus, exerting downward pressure on prices. Additionally, lower sugarcane prices further decreased production costs, allowing manufacturers to lower selling prices. Ongoing adverse weather conditions, including droughts and fires, raised concerns about future harvests, despite overall production gains. The quarter-on-quarter change recorded a slight increase of 1%. Price comparison between the first and second half of the quarter showed no significant variation, emphasizing the overall stability in pricing trends. The quarter-ending price for Ethanol Anhydrous FOB Santos in Brazil stood at USD 700/MT, reflecting the prevailing stable pricing sentiment in the region.
FAQs
Q1: Why did Brazil’s Ethanol Price Index decline in Q2 2025?
A: Oversupply, weak hydrous ethanol demand, and port delays pulled prices down after a strong start.
Q2: What caused North America’s ethanol prices to trend downward by end-Q2?
A: Record-high production outpaced demand, leading to inventory buildup and a falling Price Index.
Q3: Will ethanol prices rise in July 2025 across regions?
A: Yes, most regions forecast price increases due to seasonal blending, policy shifts, or tighter supply.
Q4: What is the outlook for ethanol production costs in Q3 2025?
A: Costs are expected to stay firm due to feedstock prices and inflation, especially in Europe and Brazil.
