China to Import More Corn to Meet Ethanol Fuel Use – Analyst
by Hallie Gu and Dominique Patton (Reuters) China could import up to 20 million tonnes of corn a year, more than six times the current level, to meet a switch to greater use of ethanol in fuel, an analyst predicted on Thursday.
Beijing plans to roll out a gasoline known as ‘E10’ – containing 10 percent ethanol – across the world’s largest car market by 2020, state media reported last week.
As much as 15 million tonnes of ethanol would be needed when the policy is implemented, according to Reuters calculations, or about 45 million tonnes of corn, the major raw material its production.
More corn is already being consumed closer to cornfields in the top growing region in the north-east, after a series of measures introduced last year to use up state stocks.
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The forecast is significantly higher than projections by the United States agriculture department, which expects corn imports to reach just 3.8 million tonnes in the 2019/20 crop year.
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“There will be more processed products transported from the northeast instead,” said Zhang Guogang, business development manager at SDIC Biotech Investment, the ethanol division of state-owned conglomerate SDIC.
The company is building a 300,000-tonne fuel ethanol plant in Liaoning province, which is expected to go online in August next year. READ MORE
Analysis: China’s nationwide E10 ethanol mandate faces hurdles (Platts)
Young completes multi-topic trip to China (KMA Land)
Excerpt from Platts: China’s National Energy Administration recently announced that it plans to implement a nationwide E10 ethanol blending mandate but industry sources are skeptical about Beijing’s ability to do so successfully owing to uncertainty about the blended fuel’s impact on vehicles and lack of a clear pricing mechanism.
- Use of E10 is still controversial
- Demand for MTBE could be affected
- Fuel ethanol demand may be boosted
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MTBE is currently one of the major blending components in gasoline, with around 10% added to refinery-produced gasoline to increase its octane number, refinery and oil blending sources said.
Should E10 become mandatory, ethanol will replace MTBE as a blendstock in the future, a source said.
“But I think the price of fuel ethanol will be a key factor driving the switch,” he added. READ MORE
