According to the commodity market analysis system of SunSirs, the domestic price of ethanol has been adjusted to 5,516 RMB/ton, marking a decline of 2.36% over the past three months and a year-on-year drop of 0.86%. With the conclusion of concentrated maintenance at ethanol production facilities, supply has increased in certain regions, and the market remains characterized by an oversupply.

Regarding costs, the national average price of corn has risen slightly, though regional price trends vary: prices in the Northeast remain stable, while prices in Henan have declined. Factors on the cost side are exerting a generally bullish influence on ethanol.

On the supply side, ethanol production facilities with a combined annual processing capacity of 4.24 million tonnes underwent shutdowns during the month. China's ethanol output in August stood at 835,000 tonnes—an increase of 28,700 tonnes (or 3.56%) month-on-month—bringing the cumulative production for the first eight months of the year to 7.0051 million tonnes. The factors influencing ethanol supply present a mixed picture.

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, also up by 1,000 tonnes, while export volume remained essentially flat at 200 tonnes. A breakdown by downstream sector reveals that consumption of traditional Baijiu remains sluggish. Conditions in the chemical downstream sector have improved somewhat; specifically, Yankuang's ethyl acetate unit has resumed production, whereas the units at Hualu, Lianhong, and Mingde remain offline, with procurement in the chemical industry driven primarily by essential contract-based orders. Overall, demand-side factors for ethanol are positive.

Market Outlook

Downstream buyers are stocking up ahead of the holiday, driving up both demand and prices; combined with rising freight costs, this has led to an increase in delivered prices. Ethanol analysts at SunSirs anticipate that the ethanol market is likely to trend upward.

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