Brazilian mills willing to pull out of long-term anhydrous contracts in favor of hydrous sales

November 29, 2017 |

In Brazil, with demand for hydrous ethanol soaring thanks to higher gasoline prices that makes the biofuel more competitive for use in flex-fuel cars, sugar mills have said they’re willing to re-nig—or wash out—on long-term anhydrous ethanol contracts in order to supply hydrous. Mills may start looking to hydrate anhydrous ethanol come mid-December when the sugarcane crush winds up for the year if they believe it could be worth the extra costs. The possibility would also make it cheaper for distributors to buy anhydrous as needed because the premium over hydrous is lower for spot prices than for long-term contracts.

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