Canada expects to consume 795 million gallons of ethanol in 2018, up slightly from last year and up 6 percent from average use two to three years ago. The country’s federal blend mandate is just 5 percent, although the effective blend rate can be higher. For instance, the government forecasts the blend rate this year at 6.4 percent, according to a recent GAIN report from USDA. Canada’s domestic ethanol production capacity has increased only slightly most years since 2010, so production supplies only about 60 percent of consumption, making the country an important destination for U.S. ethanol exports.
Canada imported over 328 million gallons of U.S. ethanol in 2017, a return to volumes more typical before 2015 and 2016, when Brazil was able to displace some of the U.S. share of the Canadian market. This year, Canada expects domestic production to increase 5 percent year over year, allowing for a reduction in imports. During the first two months of the year, the U.S. exported nearly 42 million gallons to Canada, down about 18 percent from Jan-Feb 2017 but slightly higher than volumes during that time in other recent years.
Cumulative U.S. ethanol exports to Canada
Posted by: Information Services Our Information Services team assists our clients with understanding commodity and ingredient market dynamics. Using our extensive database of intelligence, we also produce regular commodity and commercial market publications covering supply and demand fundamentals, news alerts on events that shape the markets, and resource guides to give you a complete picture of the industries we monitor.