According to the commodity market analysis system of SunSirs, the domestic price of ethanol has fallen to 5,521 RMB/ton, marking a decline of 3.83% over the past three months and a year-on-year drop of 1.89%. The supply-demand imbalance in the ethanol market has eased temporarily; however, based on current maintenance schedules, capacity utilization is expected to rise further in July. Amidst a situation of oversupply, ethanol market prices are undergoing fluctuating adjustments.

Regarding costs, there are expectations of a slight rebound in the price of raw material corn, while corn-based ethanol producers continue to operate at a loss. Prices for dried cassava remain stable, yet cassava-based ethanol production also remains deeply unprofitable. In South China, molasses-based ethanol prices are trending weak as molasses inventories are depleted and producer margins shrink. Overall, the impact of cost factors on the ethanol market is mixed.

On the supply side, domestic ethanol supply has declined slightly. Weekly ethanol production stood at 187,100 tonnes, a decrease of 10,900 tonnes week-on-week; imports remained unchanged at 1,000 tonnes; and total supply was 187,200 tonnes, down 10,900 tonnes from the previous period, indicating a downward trend. The supply-side situation is currently influenced by factors that are favorable to the market.

Regarding the demand side and downstream sectors: Overall demand saw a slight uptick, with total demand reaching 172,200 tonnes—an increase of 1,000 tonnes month-on-month. Domestic consumption stood at 172,000 tonnes (up 1,000 tonnes), while export volume remained essentially flat at 200 tonnes. A breakdown by downstream sector reveals that consumption of traditional *baijiu* (Chinese white spirits) remained sluggish, whereas the chemical downstream sector showed improvement. Overall, demand-side factors for ethanol are positive.

Market Outlook:

With maintenance at certain production facilities concluding, ethanol supply is expected to see a slight rebound. Although there are expectations for an improvement in downstream chemical demand, it remains insufficient to fully absorb the increased supply; consequently, the market's oversupply situation is unlikely to reverse in the near term. Analysts at SunSirs anticipate that the ethanol market will likely continue to consolidate with a weak trend.

SunSirs has been continuously tracking price data for over 200 commodities for nearly 20 years, please contact support@sunsirs.com for subscription.