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Bush Hails Biofuels Pact in Brazil

Associated Press
At a mega fuel depot for tanker trucks, President Bush heralded a new ethanol agreement with Brazil Friday as way to boost alternative fuels production across the Americas. Demonstrators upset with Bush’s visit here worry that the president and his biofuels buddy, Brazilian President Luiz Inacio Lula da Silva, really have visions of an OPEC-like cartel on ethanol.

But Bush and Silva said increasing alternative fuel use will lead to more jobs, a cleaner environment and greater independence from the whims of the oil market. In Brazil, nearly eight in 10 new cars already run on fuel made from sugar cane.
(9 March 2007)

Brazil’s ethanol slaves

Tom Phillips, Guardian
200,000 migrant sugar cutters who prop up renewable energy boom
Behind rusty gates, the heart of Brazil’s energy revolution can be found in the stale air of a squalid red-brick tenement building. Inside, dozens of road-weary migrant workers are crammed into minuscule cubicles, filled with rickety bunk-beds and unpacked bags, preparing for their first day at work in the sugar plantations of Sao Paulo.

This is Palmares Paulista, a rural town 230 miles from Sao Paulo and the centre of a South American renewable energy boom that is transforming Brazil into a global reference point on how to cut carbon emissions and oil imports at the same time.

Inside the prison-like construction are the cortadores de cana – sugar cane cutters – part of a destitute migrant workforce of about 200,000 men who help prop up Brazil’s ethanol industry.

Biofuels are mega-business in Brazil. Such has been the success of the country’s ethanol programme – launched during the 1970s military dictatorship – that it is now attracting attention from around the world.
(9 March 2007)
Related story:
Planting Sugarcane and Reaping Poverty and Eco-Degradation in Brazil (Brazzil)

US looks to Brazil to fuel energy revolution

Jonathan Wheatley, Financial Times via MSNBC
When George W. Bush arrives in Brazil on Thursday, he will bring with him an offer to promote biofuels in oil-dependant countries just as Brazil is gripped by green energy fever. Over the next six years, Brazil expects 77 new sugar or alcohol (both are raw ingredients for biofuels) plants to be built – a rate of more than one a month. According to Unica, the industry association, investments already under way amount to $14.6bn. Throughout its rich agricultural heartland, soya and other crops are being torn out and replaced by sugar cane.

Brazil has the potential to be the world’s leading producer. Establishing a partnership now would give the US the significance in the region it has gradually lost since talk of a US-led Free Trade Area of the Americas fizzled out a few years ago.

In spite of the widespread optimism, the outlook for Brazil’s ethanol industry seems uncertain. “It’s euphoria,” says Roberto Giannetti da Fonseca of Ethanol Trading, which represents more than 200 Brazilian producers. “People seem to be investing without really studying what’s going on.” ..
(7 Mar 2007)

Cuba-Venezuela: Making Biofuels Without Wasting Food

Patricia Grogg, Inter Press Service
HAVANA – The governments of Cuba and Venezuela are planning to move forward together on biofuels production, but they will rely on producing alcohol from sugarcane, in order to spare food crops.

Official Cuban sources described the cooperative alcohol program between the two countries as part of their “joint efforts” to protect the environment, reduce consumption of fossil fuels and promote alternative energy sources, while holding fast to the principle of not using edible crops to make fuels.

…experts participating in the forum on Cuban state television were insistent on the danger posed by the global biofuels fever to developing countries, as industrialized nations “talk of substituting one (energy) source for another, without changing their current patterns” of high consumption.

“What they are considering is a scheme in which most of the biofuels are produced in underdeveloped countries in Asia, Latin America or Africa, to be exported to the industrialized world,” said Ramón Pichs, of the World Economy Research Center (CIEM).

According to this model, developing countries would provide large areas of their cultivable land and cheap labor, and suffer a negative impact on food production and the environment, he said.
(7 March 2007)

Tortillas Spark Inflation, Drive Down Mexico’s Peso

Valerie Rota, Bloomberg
An increase in the cost of tortillas, a staple of the Mexican diet since the Maya ruled 1,000 years ago, has triggered a slump in the peso.

Tortilla prices jumped 5.9 percent in January, the most in eight years, after costs climbed for corn, the main ingredient. That increase fanned inflation and a bond market rout that curbed demand for the currency. The peso has fallen 2.4 percent in the past month, making it the world’s third-worst performer against the dollar among the 70 currencies tracked by Bloomberg.

“There’s a big risk that tortilla price increases will lead to higher wage demands and fuel inflation,” said Eduardo Perez, head bond trader at Mexico City-based brokerage Valores Mexicanos SA, the country’s largest independent brokerage. “Foreign investors don’t like this environment and are selling. This is directly linked to peso weakness.”
(5 March 2007)