US and 17 Other Countries Learn Biofuel Business from Brazil

The growth potential on the foreign market for fuel alcohol dominated the talks at the 25th meeting of the council of the World Association of Beet and Cane Growers (WABCG), which ended on Thursday, July 8, in the city of Ribeirão Preto, in São Paulo. Brazil.

"With the enactment of the Kyoto Protocol and the problem of the increase of oil prices, a discussion that was already taking place in many countries, but in a slower manner, has been anticipated: the use of alcohol as a fuel alternative," stated Manoel Carlos Azevedo Ortolan, the president of the Organization of Cane Growers of the Center South of Brazil (Orplana), who is hosting the event.

According to the president of the Agro-Energy and Biofuel Committee of the Brazilian Rural Society, Maurí­lio Biagi Filho, the World Alcohol market may reach 31.1 billion liters a year in less than one decade.

Today foreign sales are around 3.5 billion liters a year. "Oil prices have helped energise the sector. All concern is focussed on finding a replacement urgently. And the only easy replacement is ethanol," added Ortolan.

In Brazil, apart from having been used in large scale as a fuel for around 30 years, alcohol has become a cheaper and less polluting fuel alternative to be mixed with petrol.

With the enactment of the Kyoto Protocol, which obliges the nations that signed the agreement to reduce their pollutant emissions, various countries that mix MTBE (methyl tertiary-butyl ether), an oil derivative, study adoption of anhydrous alcohol in its composition.

The search for alternatives to oil was even the theme of the talk by the Brazilian Minister of Agriculture, Roberto Rodrigues, at the end of the event.

According to him, "agro-energy" is currently the great paradigm of agribusiness and all attentions must be turned to it. Apart from alcohol, he mentioned other energy sources, like biodiesel.

The WABCG meeting included representatives from 18 countries that produce beetroots and cane. Among them were great players in the sector, like the United States, India, Australia, nations in the European Union and Brazil.

One of the conclusions reached, according to Ortolan, was that the countries will have to invest in the production of alcohol, as Brazil has already done, so as to make the product into a commodity.

Increasing the number of producers will provide greater safety to the foreign market, which will not become hostage to few suppliers.

Gains for Brazil

In the evaluation of Ortolan, Brazil may win in two fronts. First of all, the countries that decide to use alcohol as a fuel will have to import the product, which Brazilian producers have to offer in great volume.

In the future, when these countries start producing ethanol in greater volumes, they will surely have to reduce their sugar production, which is a product that may also be supplied by Brazil.

"When we say that Brazil has 100 million hectares of land that may still be incorporated into agriculture, foreigners are very surprised," he said.

According to estimates by the National Food Supply Company (Conab), connected to the Ministry of Agriculture, Brazil should harvest around 450 million tons of sugarcane in the 2005/2006 crop and produce 27.2 million tons of sugar and 17.5 billion liters of alcohol.

According to Ortolan, cane production should increase by at least 200 million tons in the next eight years so as to reach the demand.

Despite the optimism with regard to the growth of the market, producers are worried with the prices paid to sugar and alcohol industries.

"The price of cane is currently not very profitable for farmers. It is necessary to improve these prices so as to make the sector grow as a whole," he said.

Established in 1981, WABCG brings together associations of farmers from 31 countries. According to Ortolan, as alcohol was among the main topics of discussion, the participants were also very interested in learning about the bi-fuel engines that are produced in Brazil, which operate both on petrol, alcohol or any mixture of both fuels.

ANBA – www.anba.com.br

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