Brazil has never produced as much ethanol in any season as in 2019. 35 billion liters. Nevertheless, stocks between sugar cane harvests are so low that there is barely enough to meet demand.
Ethanol production in Brazil's Center-South grain belt ends in mid-December and does not start again until April with the new season. In the meantime, the market must obtain supplies from product stocks or import from abroad or the north-east of the country.
Demand is very high, and experts and analysts from the brokerage firm INTL FCStone expect supply bottlenecks in February and March. Both production and consumption have been at record levels this year. For the first time ever, monthly sales of ethanol in Center South exceeded the 2 billion liter mark. Since October, the majority of flex-fuel vehicle owners have opted for ethanol because petrol prices have become too expensive.
Experts put the current supply, including the initial stock, at 7.62 billion liters. This means that a demand of 2 billion liters can hardly be met. Then we would be sold out. Prices have already risen. The import of ethanol from the USA is becoming increasingly likely. The duty-free quota of 300 million liters per month is already being called up. The duty rates are 20%.
Source
HANSA Terminhandel
