Introduction: Ethanol, commonly known as alcohol, can be divided into edible alcohol and industrial alcohol according to production methods. Edible alcohol is a product obtained by fermenting food and yeast in a fermentation tank, filtering, and distilling. It is usually an aqueous solution of ethanol and does not contain toxic benzene and methanol to the human body. Industrial alcohol is ethanol obtained by cracking long-chain organic compounds in petroleum under catalyst and high temperature conditions. In order to distinguish it from edible alcohol, industrial alcohol contains a certain amount of organic toxic substances such as methanol, which are also clearly marked and explained on the outer packaging. The ethanol specification monitored by Business Society is food grade 95% ethanol.

Firstly, let’s review the trend of the ethanol market in 2024. The domestic ethanol market prices remained in a range of fluctuations in 2024, with a weak downward trend in the first quarter. Although the Spring Festival holiday was interspersed during this period, downstream market demand did not recover as expected. Under the constraints of demand, the ethanol market showed a weak and volatile trend; In the second quarter, the market was mostly in a stalemate state, and domestic regional quotations showed a range oscillation trend; Although the third quarter was a golden September and silver October, the demand performance was poor, and the domestic ethanol market continued to be weak. As of the end of the year, the domestic ethanol market has been weakening, but there are still few obvious positive factors supporting it in the market.

In recent years, ethanol has become a necessity in people’s daily lives as the main disinfectant, and the proportion of medical alcohol has increased significantly, becoming one of the main uses of ethanol. At present, there is sufficient supply of medical alcohol to meet people’s living needs, and prices are rarely too high in a short period of time due to insufficient supply.

Let’s take a closer look at the domestic ethanol market trend in 2024:

The domestic ethanol market experienced a weak downward trend in the first quarter. At the beginning of the quarter, large factories in Northeast China had sufficient supply and a positive attitude towards shipment. Under inventory pressure, quotations continued to weaken, and the price of corn ethanol in Henan province declined due to poor shipment. During the Spring Festival period, large factories in Northeast China maintained normal production, and shipments before the Spring Festival were average. Enterprises had inventory and the snowfall weather affected the market prices of shipments, which continued to weaken. After the end of the Spring Festival, downstream terminal operators carried out post holiday restocking, but overall supply was sufficient, with some large factories actively selling and prices weakening. At the end of the quarter, the domestic ethanol market prices remained within a range of fluctuations. Due to an increase in procurement volume, enterprise quotations rose, resulting in limited transactions and a decline in prices. Henan corn ethanol fluctuates significantly, with prices falling after a short period of vehicles in front of the door, and prices rising when orders increase and vehicles increase.

The domestic ethanol market maintained range bound fluctuations in the second quarter. At the beginning of the quarter, there was sufficient inventory, and the market price weakened due to shipping pressure from the shipper. Before the May Day holiday, there was a decrease in supply within the market, coupled with pre holiday stocking, resulting in a state of supply-demand balance. Fuel ethanol continues to rise, mainly supported by main procurement and maintenance of the Laha fuel line. By the end of May, the major factory maintenance was completed, and the Hongzhan Jixian and Laha factories were restarted, resulting in a rebound in waterless production and a slight decline in waterless prices. At the end of the quarter, fuel ethanol showed a slight decline after a strong operation. With the end of the college entrance examination and an increase in summer travel, demand remained strong. Supported by the demand side, fuel ethanol operated steadily, moderately, and strongly. However, due to the continuous rise in freight costs, the price increase of fuel ethanol in the market was limited. Supply has increased, and downstream enterprises in the terminal have maintained on-demand procurement. Under the game of supply and demand, market prices have slightly fallen. After the price reduction, the market supply and demand maintain a tight balance and overall stability. There is a weak expectation in the market under the situation of supply side recovery.

The domestic ethanol market continued to be weak in the third quarter, with a lack of strong support within the market. At the beginning of the quarter, market prices began to decline in East China, and the downward trend in procurement prices had a negative impact on factory quotations. Based on cost support, the decline was limited; The rise and fall in the Henan region were divided, and the on-site thick source equipment was temporarily shut down, boosting the intention of holders to raise prices. However, after the price rose, transactions were limited, and prices began to fall when the equipment resumed. As of August, the demand side has not shown any improvement. The Northeast region is experiencing a weak downward trend, with high inventory levels in the equipment recovery area. The main focus is on digesting previous orders and contracts, and there is room for negotiation with some large customers. At the end of the quarter, during the double festival replenishment cycle, the domestic ethanol market experienced ups and downs. The spot supply in the Northeast region has slightly decreased, coupled with the support of previous order contracts, boosting market sentiment; The demand performance in the East China region is poor, coupled with the impact of the Northeast’s supply of goods, resulting in weak market prices. The raw material corn has experienced a significant decline due to the launch of new grains, which has formed a clear negative impact on ethanol prices. In addition, the demand before and after the Double Festival was lower than expected, and the market price is weak and difficult to change.

The domestic ethanol market maintained range bound fluctuations in the fourth quarter. During the National Day holiday, on-site shipments were average, putting pressure on cargo holders and making it difficult to find favorable factors to support demand. After the National Day holiday, downstream demand at the terminal continued to be weak, and the supply-demand contradiction was difficult to improve. The quotations of major factories in various regions began to weaken. Until the end of the year, the ethanol market continued to be weak, with prices for production companies falling repeatedly.

In the short term, in winter, some enterprises in Northeast China must keep heating and power plants in operation, and overall operation should remain high; Looking at 2025, there are still plans to put devices into the market. From the perspective of production time, they are mostly concentrated in the second half of the year, and with the stable operation of the devices in the early stage, there may be an increasing trend of supply or inventory in the later stage.

Overall, it is expected that the domestic ethanol market will continue to fluctuate within a certain range in 2025, and there may be downward space in the weak demand side, waiting for obvious favorable factors to support it in the market. In the later stage, it is necessary to closely monitor the fluctuations in raw material prices, the operation of on-site equipment, and the follow-up of downstream demand.