BRAZIL
‘Ethanol production from this technique will be able to compete with gasoline as long as oil is above $40 a barrel.’
explored the carbon-credit potential of such plants. The model of building a biodiesel plant onto an existing cane mill reduces required investments and costs and makes maximum use of acreage around the plant. It starts with an opportunity to plant oilseed crops in sugarcane fields: Cane is a grass that grows back every season after cutting. Producers replant 15 percent to 30 percent of the land around a mill for yield purposes every three to five years. The balance of the land is available for a single rotation of soybeans, peanuts or sunflowers. In the case of the Colombia plant, the biodiesel facility is a standalone operation—yet the international expansion accentuates Dedini’s growing skill at both biofuels.
Tailspin Brazil launched its biodiesel program 30 years after implementing its Pro-Ethanol Program in the 1970s to reduce its dependence on foreign oil. At the time, Latin America’s agricultural giant was one of the world’s largest petroleum importers, bringing in nearly 90 percent of its
domestic needs from abroad. The oil crisis at the time sent the economy into a tailspin and the military dictatorship, in addition to stepping up domestic oil exploration and production, bet that sugarcane producers could make their own automobile fuel in Brazil if the government would guarantee them a captive market. Nastari Now, Brazil has one of the most advanced biofuels programs in the world with more than 30,000 filling stations offering pure hydrous ethanol as well as gasoline with a mandatory blend of E20 to E25. Dedini’s interest in the biodiesel side is logical. Brazil’s government made a 2-percent biodiesel blend in all commercially sold diesels mandatory on January 1 and in March decided to accelerate the program with plans to have B5 in place by 2013—though recent discussions have raised the possibility of a B5 blend as early as 2010. In any case, on July 1, Brazil will raise its mandatory blend to B3. The decision was made in order to soak up some of the slack capacity in the biodiesel industry, which officials believe inhibited investment that would get Brazil closer to B5. In the first half of 2008, Brazil’s National Petroleum Agency (ANP) reports purchasing 480 million liters (127 million gallons) of biodiesel to supply the market at B2 for the first half of 2008. With the B3 mandate, demand for biodiesel should jump by 50 percent in the second half of 2008. The government’s political commitment to developing Brazil’s biodiesel market bodes well for Dedini as an equipment supplier in the sector.