Philippines' DOE sets Q4 domestic ethanol allocations 10% lower than Q3 at 103,613 cu m

25.07.2018

The Philippines' Department of Energy has set local monthly allocations, or LMAs, for domestic ethanol production at 103,613 cu m for the fourth quarter of this year, a source with a major Philippine oil company told S&P Global Platts Monday.

This is 9.61% lower than 114,633 cu m for Q3, but a 50.71% spike compared to Q4 2017.

The Q4 LMAs comprised of 37,413 cu m for October, 32,250 cu m for November and 33,950 cu m for December, the source said.

"There has been no increase on acreage and molasses production in general, yet ethanol production is up," a Philippine ethanol buyer said in response to a 22.45% year-on-year jump in 2018 LMAs to 367,686 cu m.

The Philippines LMAs are determined every quarter, and oil companies in the country are allocated a purchase quota proportionate to their market share in the retail gasoline market.

These oil companies are required to fulfill their domestic allocations before they can import cheaper fuel-grade ethanol, sources said.

The Philippines' domestic bioethanol reference price for June rose 4.07% from May to an 18-month high at Pesos 57.74/liter ($1,154.8/cu m), data released July 12 by the Sugar Regulatory Administration showed.

In comparison, the average CIF Philippines fuel ethanol price for June was $473.43/cu m, which was less than half of domestic prices even after including 1% import duty and 12% value added tax, Platts data showed.


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