Corn-ethanol not seen as threat to Brazil's cane-ethanol producers
Growing demand for ethanol in Brazil should ensure that the expansion of corn as a feedstock for the biofuel does not jeopardize cane-based producers, Plinio Nastari, president of agribusiness consultancy Datagro, said on Tuesday.
Corn-based ethanol production in Brazil has more than tripled since the turn of the decade while cane-based ethanol output has flattened. Brazil's cane mills can produce either sugar or ethanol from cane.
Nastari told a sugar industry conference that Brazil can absorb both more corn and more cane-based ethanol, not least because the proportion of its flexible-fuel car fleet using ethanol at present is low.
"It is around 27% of the fleet. We had in the past 42%, so there is room, and not only for land transport. We believe very soon we'll start seeing ethanol being used for sea transport," Nastari told delegates at the International Sugar Organization (ISO) seminar in London.
He added that, if anything, the tendency was for greater integration between cane and corn as raw materials for ethanol production in Brazil because standalone corn ethanol plants have to buy biomass fuel whose costs are constantly increasing.
Cane mills, by contrast, can use bagasse, a byproduct of sugarcane crushing, as energy to transform corn into ethanol.
Brazil earlier this year hiked the mandatory blend of ethanol in gasoline to 30% from 27%, requiring well over 1 B more liters of ethanol per year.
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