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Europe industrial ethanol demand, prices spike as coronavirus disrupts market


 Spot prices for Europe industrial ethanol are spiking and the market is facing disruption as demand soars for disinfectant and cleaning products linked to coronavirus.

Biofuel producers, gin distilleries and perfume manufacturers are switching to ethanol production to help meet the spike in demand.

France's two largest ethanol producers have confirmed they are redirecting fuel ethanol production capacity into the industrial markets

Countries such as Italy which rely on feedstock imports from overseas are supplied for now, but could face shortages due to logistical constraints.

Land transport by truck is also subject to delays as borders are closed or restricted to commercial traffic. A lack of storage space at ports and in countries like the UK has also limited stockpiling.

UK spot prices of £900/tonne have been heard, at the top end of the quarterly contract settlement range.

Meanwhile, there is an expectation that demand for fuel ethanol could fall dramatically as more restrictions on movement of people fall into place across Europe. Some ethanol producers plan to switch from fuel to industrial grade ethanol.