Ethanol reported trucked into Dallas in wake of railway slowdown

Ethanol reported trucked into Dallas in wake of railway slowdown

Houston (Platts)--27Apr2006

Ethanol was being trucked into the Dallas area Thursday to make up for
some of the shortfall of the gasoline additive caused by the stalling of rail
deliveries into the area, market sources said.

The spot ethanol trucked into Dallas is being sourced from Houston, as
well as from the Midwest, sources said.

The Union Pacific Railroad announced Thursday it had "embargoed" rail
deliveries of ethanol to the Dallas area in the wake of extended delays in
offloading rail cars of the gasoline additive (story 1629 GMT) as it is set to
replace MTBE in most of the US.

Prices for spot ethanol in Dallas were pushed to $2.95/gal Thursday, up
about 20 cents/gal over the past week, as buyers scrambled to make up for the
delayed rail deliveries, market sources said.

The problem in Dallas is at least partly attributable to a lack of
sufficiently proper terminals. While there are terminals that can accept rail
deliveries in the Dallas area, many suppliers do not have access to them. They
have been using "trans-loading" devices that can load directly from tank car
to truck from a rail siding.

Those areas have been experiencing delays with rail track switching and
loading, and that has apparently back up cars "for miles," according to one
major buyer.

--Robert Sharp, robert_sharp@platts.com

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