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Cropenergies mulls ethanol plant shutdowns as energy, raw material costs rise

Cropenergies mulls ethanol plant shutdowns as energy, raw material costs rise
By Reuters
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- German biofuel producer Cropenergies on Monday said it might have to reduce or temporarily shut down production at some of its ethanol plants due to rising energy and raw material costs.

A subsidiary of Europe's largest sugar refiner Suedzucker, Cropenergies said a particular focus would be on its plant in Wilton, Britain, as increased prices for natural gas and power put severe pressure on the plant's profitability.

The plant, which has an annual production capacity of 400,000 cubic meters of renewable ethanol, could even cease operations from January 2023, the company said.

It said higher ethanol imports into the European Union and Britain from Brazil and the United States had reduced the sales prices for the biofuel.

Prices of ethanol imported from Brazil have plunged after heavy tax cuts on fuels, particularly gasoline.

"Within the coming weeks, management will closely monitor the energy, grain and ethanol markets and decide whether capacity adjustments or even a temporary shutdown of individual plants will be necessary," the company said.

Cropenergies confirmed its full-year outlook for a revenue of between 1.47 billion euros and 1.57 billion euros ($1.47-$1.57 billion) and earnings before interest, tax, depreciation and amortisation (EBITDA) of between 255 million and 305 million euros.

The shares of Cropenergies were down 6.9% as of 1010 GMT.

($1 = 1.0025 euros)

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