According to the National Agency for Petroleum, Natural Gas and Biofuels (ANP), the turnover of ethanol is more beneficial than that of gasoline in two Brazilian states, Paraiba and Mato Grosso. This is due to the fact that the value of alcohol reaches 70% of the price of gasoline.
According to the agency, the price of ethanol across the country had been declining for 22 weeks, when a change of scenery occurred, resulting in an increase in six consecutive weeks. During the research period, an increase of about 12.46% was verified. At an average price of R$3.79.
The ANP study covered the period from 6 to 12 November. A liter of alcohol in the northeastern state is priced at R$3.32, while petrol costs R$4.80. In the Midwest, ethanol costs R$3.49, while gasoline costs R$5.02.
At the end of September, seven states, plus the Federal District, were found to be more competitive in negotiating values for ethanol. We can highlight Goiás, Bahia, Mato Grosso do Sul, Minas Gerais, São Paulo and DF. In São Paulo, the alcohol value is close to the limit, with fuel being R$3.69.
To begin with, the countries that offer the lowest competitiveness among negotiated fuel values are Amapa and Rio Grande do Sul, where gasoline is cheaper than alcohol. This is due to the fact that there is an increase in supply and demand regarding products in these regions.
In fact, the price of ethanol is also affected by the price of gasoline. Notably, the fuel has been on the rise for five weeks, averaging R$5.02 per liter across Brazil. Thus, when gasoline is more expensive, people tend to switch to alcohol, and vice versa.
When more people buy one type of fuel, people tend to get more expensive, causing them to go back to consuming another product. In addition, there is a strong influence of the price of sugar on the value of ethanol, since its raw material is the same as sugar cane.
There are many issues that can cause an increase in the price of alcohol, we can highlight the harvest, the global price of sugar, the growth of domestic demand, the price of gasoline, and others. In recent weeks there has been an increase in treadmills due to the off-season.
According to information from the Center for Advanced Studies in Applied Economics (Cepea-USP), there was a decrease of R$0.04 in the price of a liter of alcohol on November 11. $1.17 reduction in refineries in São Paulo state. It is an indicator that indicates the end of the bullish trend that was observed in the previous weeks.
Several factors affected this decline in ethanol prices in the state, such as the rains that affected production, making it difficult to harvest sugar cane, and the change in the price of gasoline, due to the alignment of fuel with the international scenario.
The value of ethanol should be useful up to 70% of the price of gasoline. It should be borne in mind that an alcohol-powered car costs a little more to cover the same distance as a petrol-powered car. For this reason, it is often preferred to choose the second option.
The states where ethanol is more expensive are Amapá, Rio Grande do Sul, and Roraima. Therefore, in these areas it is better to continue to use gasoline as fuel. This is due to the fact that the average price of alcohol is often higher than the average price charged at gas stations.
Advantages of ethanol
In most states of the union, there is no alcohol benefit in hybrid cars. So, who gets to choose, it’s best to stick to petrol. At least in the off-season, until the price of ethanol comes down, to make up for its use.
In the middle of the year, there was a government measure in order to lower the value of fuel across the country by lowering the Tax on the Circulation of Goods and Services (ICMS), which caused its value to drop slightly. However, there is no forecast of a decline in the future if there are no public policies on this issue.
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