FOB Santos anhydrous ethanol cargo to head to US in late May: sources
A cargo of FOB Santos anhydrous fuel ethanol will soon head to the US, according to information from several sources.
The vessel Silver Stacie is due to load 40,000 cu m of anhydrous ethanol in Santos, Brazil, by May 25 to head toward Tampa, Florida.
A weaker exchange rate between the Brazilian real and US dollar has triggered discussions over the past week for Brazilian ethanol cargoes of 35,000 to 40,000 cu m to head toward the US.
Over the past week, buying interest was reported at around $450/cu m while sellers were heard at $485/cu m for the same loading period.
The deal was rumored traded at $455/cu m, which market participants saw as the breakeven point to take Brazilian ethanol to the US.
Traders said only verticalized companies with a producing infrastructure in Brazil and distribution in the US would be able to take Brazilian product into the US for fuel use.
“This trade should be an internal deal, to close balance amongst companies,” a Brazilian trader said.
Mew discussions were heard Monday for June loading at $465/cu m bid against $480/cu m offer.
Platts assessed FOB Santos anhydrous ethanol for 10-30 days forward loading at $470/cu m on Monday.
Calculations from Kingsman, Platts’ agricultural analysis unit, showed the arbitrage window closed by $47/cu m (18 cents/gal) for cargoes arriving in New York Harbor in June.