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Brazils president urges US to invest in biofuels in poor countries

Milton Maciel, Biofuels Now
Brazilian president Lula da Silva affirmed yesterday, Jan 26th in Davos, Switzerland, that his country volunteers to transfer technology for production of biodiesel and ethanol to poorer countries, most of them in Africa and Central America, for free.

Speaking at the 2007 World Economic Forum, Lula suggested that rich countries should finance such kind of projects in countries in development, as a form of reducing inequality in the world.

“Biodiesel generates employments, generates income, generates development. Our biofuels program could be an example to be financed by rich nations to poorer nations of Africa and Central America” said the Brazilian president.

One of the main subjects discussed in Davos is Global Warming, caused principally by combustion of fossil fuels. Biodiesel and ethanol, IF produced under economic and environmentally sustainable conditions, are a viable alternative to those fossil fuels. Well, tropical countries are exactly those who have the best conditions to accomplish that sustainable and cheaper production.

Lula mentioned, as an example, that USA, instead of producing ethanol from corn, could save much money if decided to finance and acquire biofuel production from poorest countries.

Actually, we believe, this is a much better alternative to continue importing oil from potentially hostile suppliers, an alternative not only with lower costs, but also without the burden of oil wars costs. And an alternative that, promoting some substantial development in biofuels producing countries, could not only reduce somewhat the terrible inequalities, but would also lessen the migratory pressure from those countries to USA, Canada and EU.

This is also our thesis in Biofuels Now. A great number of poor countries in Africa and elsewhere have good environmental conditions that favor the development of sustainable biofuels industries and this could prove of great value for their development in the verge of Peak Oil. We partake completely the Brazilian government policy of taking biofuels technology to many other countries in the world. These countries have available soils, water, cheap land and labor; and also much, much poverty.

Our particular position, however, is that we must do our best to spread good ORGANIC AGRICULTURE BASED technology for ethanol, biomass, biogas and biodiesel, so this is going to be the nucleus of most information that will be found in Biofuels Now site as long it develops in time.
(27 Jan 2007)
I’m cautiously pessimistic about the prospects of internationally traded biofuels, which would extract real agricultural wealth from poorer countries to fuel inefficient motor vehicles in the richer countries. It’s hard to imagine what could be bought with the earned money to offset this loss of real wealth. The energy costs of transportation would also make marginal fuels unviable, however sugarcane ethanol seems to have a high enough EROEI that it might be viable. Objections aside, Milton is always worth listening to as an experienced organic sugarcane farmer who takes an intelligent and nuanced approach to promoting biofuels.

Understanding the corn ethanol EROI divide

Cutler Cleveland, The Oil Drum
The corn ethanol EROI divide is really pretty simple.
1. The principle differences between the higher (Farrell) and lower (Pimentel) estiamtes are:
a. the lower folks include some energy inputs (irrigation water, crop drying costs, labor) that the higher folks do not (probably a good thing)
2. the lower EROI folks generally use older and thus higher energy intensities (BTU/kg) for energy inputs (NOT a good thing, for sure).
3. the lower EROI folks do not assign an energy output credit to the byproducts (good/bad depends on the question being asked)

Either way, presenting an EROI of 1.3 or 1.5 or 1.2 is absurb-it implies a degree of precision that does not exist. Regardless of whree you fall on 1-3 above, the uncertainties inherent in the data means that we cannot say whether the EROI from corn is above or below 1.0
(26 Jan 2007)
Posted as a comment over at The Oil Drum. Culter uses the acronym EROI for Energy Returned on Invested, we normally use the acronym EROEI to refer to the same concept, adding the extra Energy emphasise that the investment we’re talking about is in energy not financial terms. -AF

As corn price rises, so could food bills

Kevin G. Hall, Wichita Eagle (US)
President Bush’s State of the Union call for a sevenfold increase in ethanol production within a decade could have the unintended consequence of sparking corn shortages and driving up prices for a wide array of food products.

To meet Bush’s goal, a substantial amount of corn that’s now used to feed animals or make food products may be diverted to producing alternative fuels, and that worries cattle ranchers, hog farmers and poultry producers, who depend on feed corn to raise their animals. They’ve already seen per-bushel prices for corn double over the past six months, and they expect further price increases as dozens of ethanol plants open over the next two years.

“Bottom line is, it has already gone up substantially,” said Gene Gourley, a pork producer in Webster City, Iowa, who fears forecasts that the feed corn available to his industry could shrink by 30 percent or more. “We’re not opposed to ethanol production…but it’s just trying to balance the growth of that industry along with the livestock needs.”

In 2000, about 6 percent of the nation’s corn harvest went to produce about 1.6 billion gallons of ethanol. Last year, 20 percent of the corn harvest was used to make 5 billion gallons of ethanol. ..

“When the price of corn goes up, the price of feed goes up. And the price of products that we put into our shopping cart goes up,” said Janet Larsen, the research director of the Earth Policy Institute, an environmental group that isn’t sold on ethanol.

In a report this month, the institute said that by 2008, ethanol distilleries will require more than twice the amount of corn forecast by the U.S. Department of Agriculture early last year.

Ethanol’s backers counter that growing demand sends an obvious signal to corn farmers.

“The fact of the matter is, the markets are adjusting to the shifting demands for grain. All indications are that corn farmers are going to dramatically increase the acres planted (this year),” said Ron Miller, the president and chief executive of Aventine Renewable Energy, a large ethanol producer in Pekin, Ill. ..
(26 Jan 2007)

US corn exports to fall as ethanol use rises

Reuters/Daily Times
The United States could shift from the world’s largest exporter of corn to a net importer as its burgeoning ethanol industry continues to expand, but in the meantime sales abroad are poised to rise as farmers boost acreage to cash in on decade-high prices.

“We will certainly have the opportunity to export at least as much in 07/08 as we appear to be doing in 06/07,” said Robert Kohlmeyer, president emeritus of World Perspectives, a group of consultants and analysts based in Washington, DC “Looking ahead, there’s no doubt there’s going to be a demand squeeze on world corn supplies.”

The demand for corn-based ethanol could be so strong that the United States might one day become a net importer of corn, said Jose Rasco, investment strategist at Merrill Lynch. “If the US becomes a net importer of corn, it could drastically affect the global corn industry,” he said. “Our ability to export corn will probably be diminished by the increased demand domestically from the energy side.”

Most analysts do not foresee such a drastic shift. But calls by President George W. Bush to use 35 billion gallons of renewable fuels by 2017 have many pondering how the country will achieve such a goal. ..

US ethanol production was about 5 billion gallons in 2006. Producing 35 billion gallons of ethanol solely from corn would consume the entire US corn crop at the level currently produced each year about 11 billion bushels. ..
(27 Jan 2007)

Expanded Biofuel Production Expected to Drive Up Food Prices

Staff, Farmscape (Ca)
Canadian consumers can expect to pay more for pork and other red meats and poultry down the road as North American livestock producers adjust to increased competition for grains that have traditionally been used to feed livestock. ..

The impact of using grain for fuel was one of the key topics examined earlier this month during the Banff Pork Seminar and it was one of the topics of concern discussed among swine producers from Manitoba, South Dakota, Iowa and Minnesota during a trade mission that concluded Thursday.

“One of the big issues right now is ethanol,” says Manitoba Pork Council Chairman Karl Kynoch.

Kynoch was part of a Manitoba Pork Council delegation which spent the past three weeks taking part in trade shows in South Dakota, Iowa and Minnesota and discussing issues of common concern with U.S. producers.

“The producers in the U.S. are very concerned.” Kynoch explains, “Feed prices have gone up fast. Grain prices are where they need to be but what needs to happen now is for the meat price to follow. That’s a huge concern down here (the U.S. pork producing states). Where Iowa used to be a major exporter of corn, they could now become a major importer of corn.”

“What ever happens down here in the feedgrain price also happens in Canada and you can pretty much figure that what ever the American producer is paying for corn, we’ll be paying that in Canada plus freight,” Kynoch points out. He notes, our barley and wheat prices have followed corn prices upwards. ..
(27 Jan 2007)