A day-on-day increase of Eur3/cu m to Eur649/cu m Wednesday saw the Platts T2 ethanol assessment move to its highest level since September 24, 2013 as supply into Rotterdam remained low.
"I believe this run up [in price] is supply rather than demand driven," one trader said. A a second trader said there was "just no cargo" available.
Supply problems were in part due to limited imports which has been the case since the beginning of the year.
Although the arbitrage between south and central America and Rotterdam was open, according to one source, there was not a great amount of EN spec product waiting to be shipped from one side of the Atlantic to the other. As the physical price moved up, so too did the paper market.
The front-month swap increased Eur5/cu m to Eur590/cu m, the highest since August 30, 2013 and the second-month swap increased Eur4/cu m to Eur567/cu m, the highest since August 27, 2013.
Estimated crush margins held well in the the triple figures across milling wheat, corn and feed wheat.
The feed wheat crush spread moved close to a five-year high moving up to Eur216.86/cu m from Eur213.66/cu m, the highest level since February 26, 2010.
The situation lead one producer last week to say that with these "incredibly high margins, everyone should be running full whack".
