Jun 12, 2020
Five railcars of U.S. gasoline pre-blended at an E10 rate arrived in Guadalajara in May 2020 – 14,500 gallons of ethanol (5,300 bushels in corn equivalent) – a direct success of the U.S. Grains Council’s collaboration with the Mexican Association of Service Station Providers (AMPES) to demonstrate the economic and environmental benefits of increased ethanol use. The delivery exemplifies the importance of continued engagement in the Mexican market, including an in-country presence, to realizing increased ethanol use.
“The economic benefits keep proving themselves load-by-load,” said Stephan Wittig, USGC director in Mexico. “Despite the adverse conditions due to COVID-19, ethanol is supporting the Mexican environment, gasoline distributors, fuel retailers and most importantly, the Mexican consumer.”
The Council – together with U.S. ethanol industry partners Growth Energy and the Renewable Fuels Association (RFA) and state corn organizations – are providing information to Mexican stakeholders on the benefits of ethanol use, including savings at the pump, improved air quality and a long-term commitment to the environment.
As part of that education effort, the Council developed a strategic partnership with AMPES to offer educational workshops. This series updated Mexican gasoline station owners on developments in fuel regulations, dispelled myths about ethanol use and encouraged distribution companies to ask for quotes on ethanol and how to incorporate ethanol tanks in their facilities. In 2019, the groups – including the Council, AMPES, Growth Energy, RFA and the American Coalition for Ethanol (ACE) – conducted 11 workshops throughout the country.
Grupo Topete, a family-owned gasoline trader building a fuel terminal in Jalisco near Guadalajara, attended two of these workshops. The Council also connected the company with Petrorack, a fuel retailer in northern Mexico supportive of E10 following USGC programs like the 2019 Global Ethanol Summit.
Taking advantage of the economic benefits and shared support the company learned about during the seminars, Grupo Topete started importing pre-blended E10 gasoline in May 2020 to its already-built rail track to distribute to independent retail stations.
“Despite the steep decrease in gasoline demand in Mexico due to coronavirus restrictions – down 70 percent at the lowest point – ethanol realized competitive advantages in the Mexican market,” Wittig said. “Enough margin was offered to deliver the pre-blended E10 gasoline to retail stations within a four-hour drive of the Grupo Topete terminal in Jalisco.”
While these sales are only a small part of the overall ethanol sales to Mexico, this success demonstrates the effectiveness of the Council’s approach to provide technical education and support within the Mexican fuel industry. Each is a step toward encouraging increased ethanol use through a mix of growing quantities of locally produced ethanol with U.S. ethanol filling in the missing demand.
To accomplish that goal, the Council will continue to help fuel retailers, station equipment installers and local fuel station owners learn more about the advantages of selling ethanol-blended gasoline as Mexico’s transportation fuel sector continues to evolve.
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