Brazil: no vocation to be a net importer of ethanol
|(Fhoto UNICA/ Niels Andrea)
Brazil’s domestic ethanol market requires stable and consistent public policies, which would allow it to resume growth and regain competitiveness, according to the the Chief Representative in the European Union for the Brazilian Sugarcane Industry Association (UNICA), Lola Cárdenas. At the 2012 edition of the F.O. Licht’s World Biofuels Conference, held on May 9 and 10 in Seville, Spain, she added that Brazil is not likely to be a net ethanol importer in the long run.
In a panel examining global biofuels trade patterns and dynamics, Cárdenas stated that the ethanol export market is relatively stable in volume and what happened recently was a shift among players, with Brazil losing ground and the United States increasing its share of exports. But she stressed that the current difficulties faced by the Brazilian sugarcane industry are temporary.
“The present situation in Brazil is the result of a number of factors, namely the global financial crisis of 2008, bad weather conditions that negatively affected productivity and cane production, and a loss of competitiveness compared to gasoline for domestically for hydrous ethanol (E100), the type available in service stations and used in flex-fuel vehicles (FFVs)”, explained Cárdenas to an audience of key global biofuels industry representatives.
Specifically on ethanol imports, she highlighted the decision by the world's top two ethanol producers and exporters to grant free access to their markets, launching a new era in terms of cooperation between Brazil and the U.S. on renewables. “Free trade allows for the opportunity to import ethanol when it is needed, so that consumers will not be deprived of the product they want. However, she stressed, Brazil has no vocation to be a long term net importer of ethanol”.
Against a background of the anti-dumping and anti-subsidy investigation launched by the EU on US ethanol exports to Europe and the recently approved regulation to classify E90 as denatured ethanol, the panel engaged in a lively discussion on the impact of these issues on future ethanol flows from the U.S. to Europe.
UNICA’s presence at the conference was made possible through the UNICA/Apex-Brasil project, a partnership launched in January of 2008 and renewed in September of 2010. The main objective of the partnership is to promote Brazilian sugarcane ethanol throughout the world as a clean, renewable energy source.
The panel, “Examining Biofuels Trade Patterns and Dynamics”, was moderated by F.O.Licht's Managing Director in Germany, Christoph Berg, and included EPure Secretary General Rob Vierhout, BioUrja Trading LLC Lead International Products Trader Marcos Machado, and Daniel Nibarger, International Economist from the Biofuels Division at the United States Department of Agriculture (USDA).