Report: Low corn prices support expansion of Chinese ethanol production
Ethanol production in China is projected to rise by 17% in 2024, reaching 4.9 billion liters, up from 4.2 billion liters in 2023. The country’s overall ethanol production is expected to hit 14 billion liters, with consumption forecast at 13.989 billion liters. Falling corn prices have boosted production, and China is set to import 5 million liters of fuel ethanol this year.
Ethanol production and demand in China are expected to increase 17% this year, according to a report filed with the USDA Foreign Agricultural Service’s Global Agricultural Information Network. Domestic ethanol production capacity in China is expected to be unchanged.
China’s fuel ethanol production is expected to reach 4.9 billion liters (1.29 billion gallons) this year, up from 4.2 billion liters last year and 3.804 billion liters in 2022. A small percentage of fuel ethanol production is fossil-based synthetic fuel. The report estimates fuel ethanol from fossil feedstocks was at 60 million liters in 2023 and 2024 and at 40 million liters in 2022.
The report notes that fuel ethanol prices within the country are fixed at 91.1% of the retail gasoline price, which is set by China’s National Development and Reform Commission based on a basket of global benchmark crude prices. Since ethanol prices are tied to the price of gasoline, falling corn prices have resulted in increased ethanol production. According to the report, corn prices hit a three-year low in early 2024.
Total ethanol production in China is expected to reach 14 billion liters this year, up from 12.911 billion liters in 2023 and 11.85 billion liters in 2022.
Total ethanol consumption is expected to reach 13.989 billion liters this year, compared to 12.877 billion liters in 2023 and 11.84 billion liters in 2022. Fuel ethanol consumption is estimated at 4.905 billion liters for 2024, up from 4.199 billion liters last year and 8.31 billion liters in 2022.
China is expected to import 5 million liters of ethanol this year, all fuel ethanol. No ethanol imports were reported for 2022 or 2023. Ethanol exports are estimated at 16 million liters this year, with no fuel ethanol exports. Total ethanol exports were at 34 million liters in 2023 and 10 million liters in 2022, with fuel ethanol export at 1 million liters and 3 million liters, respectively.
China currently has 21 first-generation ethanol plants, down from 22 the previous three years. Capacity, at an estimated 7.72 billion liters per year, has remained unchanged since 2021. Capacity use is expected to reach 63% this year, up from 54% last year and 49% in 2022.
Source Link : https://ethanolproducer.com/articles/report-low-corn-prices-support-expansion-in-chinese-ethanol-production
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