Brazil

Summary of national biofuels policy and strategy - updated 21st August 2008

Biofuels substitution targets

Targets:  Ethanol: 25% substitution mandatory (but actual use over

                           50 %).

               Biodiesel: Mandatory 2% has now movd up to 3%. In 2013 will rise to five percent (B5).

Date set: Ethanol June 2007

              Biodiesel January 2008. (3% mandatory as of July 2008)

National policy and trends in biofuels crop development

Ethanol

Although mandated at 25% minimum substitution for gasoline, ethanol use now exceeds gasoline through use of blending and flex fuel vehicles capable of running on high ethanol fuels. Brazil is also a major exporter of ethanol, Sugarcane is the sole source of feedstock for ethanol production in Brazil. Currently, sugarcane occupies approximately 2 percent of total agricultural land but is increasing. Cane output is forecast to double by 2015.

Biodiesel.

In 2004 the Brazilian Government created the National Biodiesel Production Program (PNPB) in order to promote domestic biodiesel production, generate jobs and income and alleviate regional economic disparities through inclusion of family farmers, especially those in North and Northeastern Brazil. The  program should aims to reduce oil import dependency, and pollutant  emissions. Federal Law # 11.097 (enacted on January 13, 2005) defined and established a legal mandate for use of biodiesel as a fuel.

A number of raw materials are available for biodiesel production, including soybeans, castor seed, palm oil, Jatropha curcas),sunflower, peanut, animal fats, and recycled cooking oils but the USDA estimates that soybeans currently represent over 90 percent of the raw material used for biodiesel production.

A mechanism has been created by the government - the biodiesel “Social Fuel Stamp” - to provide incentives for poorer farmers (details in USDA report).

Sources:

USDA Foreign Agricultural Service:

Ethanol - http://www.fas.usda.gov/gainfiles/200707/146291791.pdf

Biodiesel - http://www.fas.usda.gov/gainfiles/200709/146292286.pdf

FO Licht's World Ethanol & Biofuels Report - www.agra-net.com