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Brazilian ethanol imports in April at highest level in 11 months: foreign trade secretariat

Brazilian ethanol imports in April were recorded at 230.7 million liters, a surge of 107% from March but still down 41% a year ago, Secretariat of Foreign Trade (SECEX) data showed Monday.

This is the highest monthly volume of imports since April 2018 when 392.3 million liters were imported.

Imports in the first four months of 2019 totaled 626.9 million liters, a plunge of 40% year on year, the data showed.

From the total volume imported in 2019, nearly 70%, or 437 million liters, entered Brazil via the North-Northeast region.

Brazil’s North and Northeast regions are a net importer of ethanol. The region is supplied by imports, usually from the US, but also by domestic shipments from the Center-South region.

The anhydrous ethanol spot price in the North-Northeast fell for the second consecutive week in the week ended May 3. The weekly assessment of S&P Global Platts for anhydrous ethanol DAP Suape one to 15 days forward was at Real 2,160/cu m, a drop of Real 80/cu m week on week.

After trading at Real 2,290/cu m on April 18, the historical record high assessed since Platts started to publish it in November 2017, the selling pressure seen in the Center-South has triggered the same downward price movement in the North-Northeast market.

Despite the recently anhydrous ethanol price drop in the North-Northeast, it was still trading at Real 265/cu m higher than at the same time a year ago.

According to Platts calculations, imported anhydrous delivered CIF Suape without the 20% import tariff was valued at Real 2,063/cu m on May 3, proving that the import arbitrage remained opened for importers with an import quota.

S&P Global Platts Analytics estimates that Brazil will import 1.54 billion liters of ethanol in 2019, down around 12% from 2018.
Source: Platts

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