Rising ethanol prices at the pump in Brazil have caused consumption of the renewable fuel to plunge in recent weeks, as drivers replace it with gasoline in their flex-fuel vehicles throughout the country. With simultaneously rising food prices come several accusations, some true, others false. The facts must be carefully analyzed.
The global financial crisis of 2008 barely grazed the Brazilian economy and may have been little more than a slight jolt for certain industries and areas of activity. But those that had been expanding with sizeable investments, like the sugarcane industry, were affected much more drastically by the dramatic loss of liquidity that year.
Yesterday marked one hundred days since the start of the 112th Congress and during that time, calls for ethanol policy reform gained considerable momentum. Deep bipartisan skepticism about continued subsidies and trade protection was on full display in the Senate on Wednesday, as Secretary of Agriculture Tom Vilsack faced the Environment and Public Works Committee.
Recently Germany introduced E10 – a mixture of 10% ethanol and 90% gasoline – at fuel stations across the country. According to media sources the sale of the new fuel has created confusion amongst drivers, mainly due to concerns over the compatibility of their vehicles with the blend.
“The only long-term solution to the world’s dependence on fossil fuels is clean energy technology, and that is why the United States and Brazil are deepening our cooperation on biofuels, and why we’re launching a U.S.-Brazil Green Economy Partnership. Because we know that the development of clean energy is one of the best ways to create new jobs and industries in both our nations.”
The recent spike in global food and commodity prices has caused fears in Brazil and countries around the world over the risk of inflationary pressures, the threat of shortages and the exacerbation of global hunger. Food prices continue to rise in the wake of consumer revolts and political riots, as seen recently in the Middle East – a region that has been a consistent net food importer.
The sugarcane industry has planted more than 46.6 million seedlings of native species in Sao Paulo state since 2007, according to data from the Greener Ethanol Protocol released by the state government (exact number: 46,674,586). The industry reached this number after...
