US ethanol arbitrage window into Europe weighing on prices but won’t likely materialize

In the Netherlands, the ethanol arbitrage window with the US opened last week, having a bearish impact on European ethanol prices in anticipation of future imports but not necessarily incoming supply due to lack of availability through at least February. The 2015 backwardation trend has continued into January with the physical market and the first five months of paper trade still in backwardation. Eastern producers are focusing on supplying local markets at the moment, leaving few trainloads available to send west.