Brazil, U.S. expand biofuels cooperation

by World Grain Staff
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BRASILIA, BRAZIL — Two important announcements involving renewable energy made on the opening day of U.S. President Barack Obama's official visit to Brazil, both directly relevant to Brazil's successful sugarcane ethanol industry, are encouraging signs that Brazil and the U.S. are on a path to achieve free, unobstructed trade for clean, renewable biofuels, said Marcos Jank, president and chief executive officer of the Brazilian Sugarcane Industry Association (UNICA) on March 20.

The first major announcement expands the existing memorandum of understanding between Brazil and the U.S. to advance cooperation on biofuels, signed in 2007, to include a new partnership for the development of aviation biofuels. Key goals in the agreement include developing sustainable aviation biofuels as an important means of reducing greenhouse gas emissions, establishing common standards and specifications and strengthening private sector partnerships.

Of particular interest to UNICA is a clause calling on the two countries to work to "prevent international barriers to biofuels trade and development." Various companies are developing aviation fuels based on sugarcane, including a three-way partnership between Brazilian regional jet manufacturer Embraer, engine manufacturer General Electric and California biotech company Amyris. In 2012, the trio intends to stage the first-ever flight using jet fuel produced from sugarcane, using an Embraer aircraft equipped with GE engines and owned by Brazil's Azul Airlines.

"These developments add to the signs of growing awareness we've been witnessing in the U.S. in recent months about the need to develop clean energy solutions cooperatively and reduce barriers to its trade and development. Even avid supporters of heavy subsidies and steep tariffs that prevent Brazilian ethanol from entering the U.S. market competitively are now openly discussing what happens next, both in terms of technologies and policy. Without admitting it, they're in fact recognizing that the current situation can't last much longer, because it works against everyone's best interests. U.S. consumers are being denied access to clean, renewable Brazilian sugarcane ethanol, which could be contributing to lower greenhouse gas emissions and save Americans money at the pump," said Jank.

The other announcement of interest to Brazilian biofuels producers is the launch of a strategic energy dialogue that involves development and access to Brazil's huge new petroleum reserves, but will also deal directly with clean energy technologies. During a speech to about 500 Brazilian and U.S. business executives in Brasilia, Obama pointed out that focusing on fossil fuels in the near term doesn't mean losing sight of what needs to happen in the future.

"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," Obama concluded, acknowledging that more than half of all vehicles on the road in Brazil are flex-fuel capable and run primarily on biofuels.

Jank sees the new Green Economy Partnership as an additional and vital step to strengthen ongoing U.S.-Brazil efforts to improve and expand production and use of biofuels domestically as well as in third countries: "This is a natural move for the top two renewable energy producers and users in the world. Brazil and the United States should be leading by example, working together to advance on all fronts, including breaking down trade barriers that hinder the global expansion of biofuels."

With energy at the top of the agenda, prominent members of Brazil's sugarcane ethanol industry were involved throughout the first day of Obama's visit to Brazil, including a luncheon offered by Brazilian President Dilma Rousseff at the External Affairs Ministry, where UNICA's Jank was among the guests with direct access to Obama.
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