Production Losses of Molasses-Based Ethanol Shrank in First 4 Months
Introduction: In the first four months of 2025, the market price of molasses-based ethanol in South China fluctuated within a narrow range, with a low point in early January and a high point in early March. On April 18, the price was the same as at the end of 2024. The price of feedstock molasses in the 24/25 crushing season was lower than that in the last crushing season, showing a trend of first falling and then rising. Therefore, the production loss of molasses-based ethanol decreased. However, the operating rate of the molasses-based ethanol industry was still low. Compared with other fermented ethanol, molasses-based ethanol lacks sustained cost competitiveness. In the past two years, the number of enterprises producing and selling molasses-based ethanol has stabilized after dropping to a low level.
Molasses prices in 2025 were lower than in the same period last year, and the production loss of molasses-based ethanol in the first four months decreased YoY.
In the first four months of 2025, the market price of molasses-based ethanol in South China mainly trended up. Affected by the decline in molasses prices during the 24/25 crushing season, the cost of molasses-based ethanol decreased, and the price of molasses-based ethanol in Guangxi was once lower than cassava-based ethanol and grain-based ethanol. According to SCI, the daily average price of molasses-based ethanol in Guangxi in the first four months of 2025 fluctuated between RMB 5,250/mt and RMB 5,550/mt. As of April 18, the closing price of 95% molasses-based ethanol in Guangxi remained the same as on December 31, 2024.
The price of feedstock molasses fell first and then rose, and the price was lower than in the same period last year. Therefore, in the first four months, the production loss of molasses-based ethanol decreased. As of April 18, delivered molasses prices of ethanol producers were RMB 1,150-1,200/mt, down RMB 25/mt from the end of 2024. In the first four months, the production profit of molasses-based ethanol in Guangxi saw a contraction and one turned positive. The average profit from molasses-based ethanol in Guangxi was RMB -166.32/mt, down RMB 470.26/mt from the same period last year.
In the first four months of 2025, the monthly average price of feedstock molasses was between RMB 1,100/mt and RMB 1,175/mt, a significant drop from RMB 1,520-1,575/mt in 2024. This was mainly because the output of molasses increased. Molasses, the output of molasses, the main feedstock of molasses-based ethanol, has a direct correlation with sucrose output. Guangxi’s 24/25 crushing season ended in early April, and players estimated molasses output based on the sugar output of sugar mills. It was estimated that Guangxi’s sugar output was about 6,500kt, up 300kt compared with the previous crushing season, and molasses output was estimated to rise by around 100kt.
The production period of molasses-based ethanol in Southwest China was still short in 2025, and some Guangxi’s producers are waiting-and-see.
As of April 18, only one molasses-based ethanol producer in Yunnan was under production. Gengma Hualin Alcohol plans to stop production on April 21, and producers mostly intend to clear their inventory, so the producers hold short resources after the crushing season ends. Although the supply of molasses in Guangxi has increased, the cost in 2025 may continue to be lower than in the same period last year, but the profit is not good so far. Molasses-based ethanol producers in Guangxi are in a shutdown but mostly continue to sell inventory, and the subsequent production plan will also be decided based on the profit. The downstream dependence on molasses-based ethanol has decreased. In the past two years, the number of enterprises producing and selling molasses-based ethanol has dropped to a low level and then stabilized. Although the profit of most molasses-based ethanol producers has improved this year, factors such as underperformed demand and unsustainable cost competitiveness have also caused most producers to shut down after the crushing season ends.
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