German renewable ethanol producer CropEnergies AG is considering the need for capacity adjustments or even a temporary closure of plants due to the surge in energy prices and continued high raw material prices.
The company said on Monday that so far higher ethanol prices have been able to offset increased costs. However, the EU and UK markets have recently seen more imports from Brazil and the US, where energy and raw material prices are lower, which is driving down ethanol prices in Europe.
CropEnergies called for support for energy-intense companies and efforts to ensure a level playing field on the ethanol market in Europe.
The German producer is not sure it would maintain current capacity utilisation after January 2023. In particular, there is a risk for the Ensus plant in Wilton, UK with a capacity of 400,000 cubic metres of ethanol a year, which is under strong pressure from increased prices for natural gas and power.
The company still confirmed its annual 2022/2023 outlook for an increase in operating profit to between EUR 215 million and EUR 265 million from EUR 127 million in the previous year. Still, factors such as the effects of the Ukraine war or the development on the energy markets are hard to estimate.