Brazil’s Hydrous Ethanol Consumption Grows in June, but Remains Below Volume Needed to Absorb Record Production

● Hydrous ethanol consumption in Brazil reached 1.833 billion liters in June, up 10.9% compared to June of last year, bringing the cumulative total since January to 10.411 billion liters — still 1.4% below the volume consumed during the same period of 2025.

● The gain in competitiveness has not yet translated into sufficient consumption growth to absorb the expected record ethanol production in Brazil in 26/27.

● For ethanol stocks managed by CS Brazil mills not to exceed the 5-year average (2.0 billion liters) at the end of March 2027, hydrous ethanol consumption in Brazil would need to run at around 2.0 billion liters per month since April, assuming the blend rate increase to 32% from August onwards and the maintenance of exports.

● This means that the proportion of the flex-fuel vehicle fleet running on hydrous ethanol would need to be at least 30%–31% — in June, this proportion stood at 28.9%.

● Gasoline C (E30) consumption reached 3.872 billion liters in June, up 4.5% year-on-year, bringing the cumulative total since January to 23.524 billion liters — a record for the period, up 4.1% year-on-year.

● Total Otto cycle fuel consumption in Brazil reached 30.833 billion liters of gasoline equivalent between January and June, up 3.8% year-on-year — also a record for the period.

● The share of ethanol (anhydrous + hydrous) in Brazil’s Otto cycle fuel market advanced 0.2 p.p. year-on-year, reaching 47.4% in June — the highest monthly level since April 2021.