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Industrial-Use Exports Support U.S. Ethanol Amid COVID-19, Show Future Opportunities

Source: USDA GATS. To view a larger version of this chart, click on the image.
Ethanol destined for industrial-use applications helped stabilize overall U.S. ethanol exports in April and May amid a bleak period for fuel demand globally.
The world’s fuel markets were dramatically disrupted in early 2020 as governments instituted movement restrictions and released social distancing guidelines to address the COVID-19 pandemic. Industrial end-use markets – including chemical, solvent and consumer products – were impacted to a lesser extent as the pandemic triggered substantial uptick for sanitizing and disinfecting products that also use ethanol as an ingredient.
As a result, industrial ethanol played a significant role in stabilizing the overall U.S. ethanol export mix. At the same time, the U.S. Grains Council (USGC) has been working with its global staff to determine the best opportunities to assist the world’s expanding needs for industrial ethanol alongside a robust fuel ethanol program.
“As we work to expand the global use of ethanol, we are creating awareness of how the environmental, human health and economic benefits of the product apply to uses outside of the fuel market,” said Lucas Szabo, USGC manager of global ethanol market development. “We are working to foster the development of end-use applications for industrial ethanol and support current uses like sanitizers.”
Industrial-use markets typically account for 25 percent of total U.S. ethanol exports, bought for uses like windshield wiper fluid in South Korea and the European Union or bioplastics in India. As fuel demand began to decline in March, industrial ethanol exports started to represent a larger proportion of the export mix and help support overall U.S. ethanol exports.
U.S. ethanol exports for industrial uses equated to approximately 50 percent of total exports in April and May, at roughly 44 million gallons (15.7 million bushels in corn equivalent) and 33 million gallons (11.7 million bushels in corn equivalent), respectively. The remaining half of exports continued to supply fuel markets.
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