Thailand sets local ethanol benchmark price

A new local benchmark price for ethanol is 8% higher than the previous one but the impact will be minimal on pump prices of gasohol, Thai energy planners said. The benchmark price was set at 18.59 baht a liter (US$0.54), up from 17.18 baht (US$0.50). Officials said Thailand needed to set its own reference prices because the futures market in Brazil, which was being used as the reference price, has been suspended since January. As a result, drivers will pay 0.10 baht (US$0.0029) more per liter for gasohol 95, a blend of 5% ethanol and 90% petrol, and 0.28 baht (US$0.01) more for E20. The new formula better reflects local costs because Brazilian producers use only sugar and molasses, while Thailand also uses cassava as ethanol feedstock, explained Chalush Chinthammit, deputy general-secretary of the Thai Sugar and Bio-Energy Producers Association. The Energy Ministry has also approved an increase in the subsidy for E85, a blend of 85% ethanol, to eight baht from 5.70 baht (US$0.23 to 0.16) per liter, to boost sales. (May 2, 2009)