The Atten Babler Commodities Ethanol Foreign Exchange (FX) Indices were mixed throughout Oct ’21. The USD/Ethanol Producer FX Index increased to a six month high value however the USD/Domestic Ethanol Importer FX Index finished lower throughout the month.

Global Ethanol Producers:

Major ethanol producers are led by the U.S., followed by Brazil, the EU-28, China, India and Canada.

The U.S. accounts for half of the USD/Ethanol Producer FX Index while Brazil accounts for over a quarter of the index.

USD/Ethanol Producer FX Index:

The USD/Ethanol Producer FX Index increased 1.9 points throughout Oct ’21, finishing at a six month high value of 135.2. The USD/Ethanol Producer FX Index has declined 0.2 points throughout the past six months but remains up 30.6 points since the beginning of 2014. A strong USD/Ethanol Producer FX Index reduces the competitiveness of U.S. ethanol relative to other major producing regions (represented in green in the Global Ethanol Producers chart), ultimately resulting in less foreign demand, all other factors being equal. USD appreciation against the Brazilian real has accounted for the majority of the gains since the beginning of 2014.

USD appreciation within the USD/Ethanol Producer FX Index during Oct ’21 was led by gains against the Brazilian real, followed by gains against the euro and Indian rupee. USD declines were exhibited against the Canadian dollar and Chinese yuan renminbi.

U.S. Ethanol Export Destinations:

Major destinations for U.S. ethanol exports are led by Canada, followed by the Philippines, Brazil, the United Arab Emirates, Peru and Mexico.

Canada accounts for over a half of the USD/Domestic Ethanol Importer FX Index while the Philippines, Brazil, the United Arab Emirates, Peru and Mexico each account for between 5-10% of the index.

USD/Domestic Ethanol Importer FX Index:

The USD/Domestic Ethanol Importer FX Index declined 0.3 points throughout Oct ’21, finishing at a value of 110.4. The USD/Domestic Ethanol Importer FX Index has increased 0.9 points throughout the past six months and 22.6 points since the beginning of 2014, despite the most recent decline. A strong USD/Domestic Ethanol Importer FX Index results in less purchasing power for the traditional buyers of U.S. ethanol (represented in red in the U.S. Ethanol Export Destinations chart), ultimately resulting in less foreign demand, all other factors being equal. USD appreciation against the Canadian dollar has accounted for the majority of the gains since the beginning of 2014.

Appreciation against the USD within the USD/Domestic Ethanol Importer FX Index during Oct ’21 was led by gains by the Canadian dollar, followed by gains by the Peruvian sol. USD gains were exhibited against the Brazilian real, Mexican peso and Philippine peso.