Asian bio-ethanol supply has tightened following a surge in demand for the fourth quarter when many plants in Thailand are scheduled to shut down for maintenance, sources said Tuesday.
At the end of last week, 12,000 cubic meters of anhydrous bioethanol from Thailand was sold to a trading company with tank-storage in the northeastern Philippine port of Subic Bay, a source said.
The 12,000 cu m of bioethanol is to be delivered in 4,000-cu m lots every month over October-December on an FOB Bangkok basis.
While the traded price could not be confirmed, a trader said it was above $600/cu m. It was likely sold at around $615/cu m since Thailand producers were heard offering at $620/cu m last week, said sources.
"There was a purchase for 12,000 cu m of bioethanol. The trader has bought ahead of the market as it is likely a major will have a new requirement for Q4," a trader said.
Traders estimated bioethanol exports from Thailand to be limited otherwise due to a rise in domestic consumption, and the sale will likely tighten the supply situation through to January 2013.
A number of major Thai bioethanol producers were also planning to shutdown plants for scheduled maintenance over November-December, a producer said.
"There are normally plant shutdowns during this period but some producers may store ethanol so it's difficult to say [how much of] what product will be available," another trader said.
Although the price of bioethanol ex-Thailand was expected to rise, traders said this would be largely affected by what quantities Vietnamese producers were able to offer.
"At present, Petro Vietnam [PVN] is continuing to offer into the FOB export market. It depends on the operating schedule of PVN's ethanol plants. PVN will inform customers [if it issues an] open tender," a source at Petro Vietnam Commercial & Marketing Division said Tuesday.
"From now until the end of the year, PVN can offer about 10,000 cu m of anhydrous ethanol FOB Dung Quat port", the Petro Vietnam source said.
Vietnamese bioethanol producers were said to be working on tight margins using the cassava root as a feedstock with sellers aiming to achieve above break-even production costs of $610/cu m, traders said.
