Billion gallons U.S. ethanol exported, Brazil top destination

By Holly Jessen | February 17, 2012

A total of 1.19 billion gallons of U.S. ethanol was shipped out in 2011, with one-third going to Brazil, this year’s No. 1 importer of U.S. ethanol. “The official numbers are in and they confirm what the industry has known all year: 2011 was a huge year for ethanol exports,” said Geoff Cooper, vice president of research and analysis for RFA.

In all, 909.6 million gallons of denatured ethanol and 283.5 million gallons of undenatured (non-beverage) ethanol was exported from the U.S. Of that, Brazil brought in 395.6 million gallons, which Cooper pointed out was nearly identical to the total amount of U.S. ethanol exported in 2010. Exports were up nearly 300 percent from 2010 to 2011 and increased nearly 400 percent from 2009 to 2010. Although the lion’s share of ethanol is still used domestically, export levels are increasing yearly. “Exports accounted for approximately 8.6 percent of U.S. ethanol production in 2011, up from 3 percent in 2010 and 1 percent in 2009,” Cooper said.

The 172.7 million gallons of ethanol exported in December’s set a record, according to government data released Feb. 10. Although exports dropped from the previous month in May, June and August, the remaining monthly export totals were an increase from the previous month.  

Brazil took in 33 percent of the ethanol exported in 2011. Canada came in No. 2, taking in a total of 297.5 million gallons. Next in line were Netherlands and United Kingdom, which brought in 124.1 million gallons and 119.4 million gallons respectively. An OPEC country, United Arab Emirates, ranked No. 5 and took in 64.8 million gallons of U.S. ethanol.

Clearly, Brazil has been an important export market for the U.S. industry. Brazil has had a high demand for ethanol and low supplies, due to a variety of factors. Brazil’s sugarcane season officially ends in March, but a Jan. 16 press release from UNICA, the Brazilian Sugarcane Industry Association, revealed that 2011 ethanol production from April to December was down 18.74 percent from the same time period in 2010. The amount of ethanol sold during that time period was down 19.34 percent, compared to the year before.

Over the last two years, Brazil has been importing increasing amounts of U.S. ethanol. According to a Feb. 14 press release from UNICA, from April to Feb. 1, UNICA reports that the South-central region of Brazil imported 836.43 million liters (220 million gallons) of ethanol. (Not all of it from the U.S.) In that same time period, Brazil produced 28.79 percent less hydrous ethanol but 5.37 percent more anhydrous ethanol. "Ethanol prices during this off-season are reflecting the levels of demand and supply of the product stockpiled by mills, and stocks this year are higher than during last year's interharvest period," Rodrigues said.

During the month of December, when the U.S. ethanol industry exported a record amount of ethanol, Brazil saw a sharp decline in sales of hydrous ethanol and stable sales of anhydrous ethanol, compared to December 2010. “[Overall] ethanol sales to the domestic market in December showed a slight decrease due to shipments of ethanol from the North and Northeast to states in the south-central region, as well as the arrival of shipments of imported anhydrous ethanol during the month,” said Antonio de Padua Rodrigues, technical director for UNICA.

Looking specifically at the month of January, sales of Brazilian ethanol by mills in the south-central region dropped more than 32 percent. Of the total ethanol sold in January, 1.24 billion liters remained in Brazil and only 42.44 million liters were exported. Rodrigues attributed the drop in sales to the decrease in the amount of ethanol blended in gasoline, the levels of which the Brazilian government lowered to 20 percent in 2011. "If the blend level had remained at 25 percent, sales in January 2012 would have been greater than in January of 2011," he said.