According to an article in The New Economic Times, Fiat is planning to launch a new ethanol-powered engine for the Brazilian market. Ethanol is widely used for fuel in Brazil and half of the country's sugar cane crops are currently used for its production. Fiat intends the motor to be run on fuel that the ethanol producers create themselves, saving on taxes. What is most interesting about this story, though, is that it seems the new engine will be based on a current diesel block. In fact, a small amount of diesel fuel is required to run the engine.

"Use of additives (in ethanol) makes running (an engine) dangerous, subject to explosions," according to Fiat Powertrain Technologies product development engineer Joao Irineu Medeiros. "The diesel will be just enough for ignition and the ethanol will complete the combustion," he adds. It sounds like the new Fiat design will be a compression ignition engine running on e-diesel. Instead of being mixed at the pump, though, Fiat is planning to keep the fuels separate until injected into the engine. Proper tuning would be essential, which would explain why Fiat needs until 2010 to bring this engine to market.

[Source: The New Economic Times]

Good news for Brazilians: the prices for ethanol has dropped 38 percent because of an increase in sugarcane production. Prices will continue its decrease, according to Júlio Maria Borges, an analyst at JOB Consultaría, even when the harvest finishes.

There are two determining factors for this decrease. One is the price of alcohol, which has dropped 18 percent. The second factor is the decrease in ethanol exportations. Despite President Lula da Silva's efforts to export Brazil's biofuel of choice, UNICA (the Brazilian association of sugarcane producers) expects to export just 3,100 million liters this year, whereas last year the number was 3,600 million. The US, which was one of the main customers for Brazilian ethanol, has reduced imports because of the increase in domestic production and the reduction of prices.

Related:

• Philadelphia says biofuels are good for national security and the state's economy
• Petrobras and Statoil join forces to produce biofuels
• Brazil forecasts record sugarcane and ethanol production

[Source: Instituto Español de Comercio Exterior via Econoticias]

Brazil's Companhia Nacional do Abastecimento is forecasting record levels for the 2007-2008 sugarcane production fuelled (pun intended) by the expansion of ethanol. According to this official organisation, this year's production of sugarcane will reach 547.2 million tons, 15.2 percent more than last year's 474.8 million.

The uses for this huge amounts of sugarcane are divided this way: 40.5 percent for sugar manufacturing (30 million tons of sugar) and a whopping 46 percent to produce 21.3 billion liters of ethanol, 22 percent more than last year's production. The rest of the sugarcane is used for producing specific sugars, panela and liquor (cachaça for caipirinhas, among others).

Because of the increased demand for ethanol, Brazil producers have increased by 12.3 percent the acres dedicated to sugarcane. Plans are to double this production in five-years time.

The ethanol industry is booming for Brazil, and the country has signed agreements with many countries to expand its use. For instance, Brazil exported 3.9 billion liters of ethanol in 2006, compared to 2.6 billion in 2005 - That's 70 percent of the international trading market for this fuel. Of the 2006 exports, 1.7 billion liters reached the US, 346 million went to the Nederlands, 225 to Japan and 204 to Sweden.

Related:

• Biofuels adding to destruction of Brazilian cerrado
• Mines and energy minister defends Brazilian ethanol
• Brazil teaming up with Mexico to produce ethanol
• Brazil wants to become the Saudi Arabia of ethanol

[Source: Agroinformacion.com]

It seems that, although the EU will be buying massive quantities of raw materials to produce biofuels, Brazil prefers to sell the complete product. But this would be reacted by EUs concerns on biofuel production outside its borders (and how about the raw materials?) which would lead to barriers for imports.

That's why the Dilma Rousseff, Brazilian Minister of Mines and Energy made a huge statement on Brazil's environmental responsibility when producing ethanol. Ms. Rousseff affirmed that no Amazon forests are being cut to plant sugarcane because 91 percent of sugarcane production is cultivated 2100km (1400 miles) south from the river. She also said that her government is planning a regulation of sugarcane plantations expansion, which will include a product certification to clear up any doubts on its origin.

Being from the Workers' Party, the one that rules Brazil, the minister affirmed that they couldn't trace workers exploitation on plantations, since some accusations of bad work conditions (and slavery) were slipped to the press.

Nevertheless, Brazil is investing 1 billion Reais (about half a billion dollars) in ethanol research. Current ethanol exports are 3,4 billion liters for 2006 and previsions state a whopping 8 billion liters for 2010. Brazil is also exhaustively collaborating with other Latin American countries to develop a biofuel industry.

Related:

• Brazil teaming up with Mexico to produce ethanol
• Brazil wants to become the Saudi Arabia of ethanol

[Source: Europa Press]

Ethanol is good business for Brazil: in the last 6 years, the export sales of the biofuel have risen 176 percent, according to the CEPEA - Centro de Estudos Avançados em Economia Aplicada (Center for Advanced Studies in Applied Economics) in São Paulo.

The growth was especially important in 2006, when it reached 46 percent, with a total export of 2,800 million liters of sugarcane ethanol. Petrobras, Brazil's national oil company has just been in the business for a few years, but plans to sell 850 million liters in the USA, Venezuela and Nigeria and up to 3.5 billion liters in 2011 through an agreement with Japanese company Mitsui to provide the Japanese market.

According to CEPEA, the total output of this fuel in 2005 was around 9.6 billion liters. Brazil produced 45.2 percent of this amount (made from sugarcane) and the USA 44.5 percent (made from corn).

Ethanol was a solution for the severe crisis that affected Brazil during the '80s. The country did not have enough resources to import oil and ethanol became both a solution for motoring and for unemployment. The key of its success there has always been the much lower tax that consumers pay at the gas pump.

[Source: CEPEA]

The headline on this story from Dow Jones Newswire - "Is Brazil's Ethanol Bubble Set To Cool?" - is a bit alarmist, don't you think? I think the news in the story - that Brazil's ethanol industry may soon slow down - is important, but I don't think it's fair to call a system that has been making the biofuel for decades a "bubble." Thankfully, the lede - "Is Brazil's white-hot ethanol sector set to cool?" - is a bit more tempered.

Anyway, Dow Jones reports that prices for Brazilian ethanol mills have jumped up between 30 and 100 percent since last year. Even prices for equipment used in milling projects are up 10-15 percent. Add in a global sugar surplus, and all that Brazilian yellow gold might soon be much harder to come by. Read the rest over at Cattle Network.

Related:

• Bush, da Silva talk ethanol again; charity warns ethanol is a disaster

[Source: Grace Fan, Dow Jones Newswires]

Brazilian president Luiz Inacio Lula da Silva helped open his country's first ethanol and biodiesel plant Wednesday. The plant will make both biofuels from oilseeds and represents Brazil's shift into biofuels other than ethanol, which has dominated the country's fuel economy for decades. The Barralcool plant has been making ethanol for over twenty years and was recently integrated with biodiesel production machinery.

There are 360 ethanol plants operating or being built in Brazil and E85 and E100 is easy to find throughout the country. Getting biodiesel is more difficult, but that will change a bit when the country's B2 mandates kicks in by 2008 (B5 by 2013). There are 10 biodiesel plants in Brazil, with 40 more on the way.

Related:

• Ethanol demand begins to tip the food/fuel balance in Brazil
• Brazil embarks on biodiesel

[Source: New Zealand Herald]

Ever since the dawn of the Industrial Age, Japan has had to import oil, and Japan was hit hard by the 1973 Oil Crisis. Even though the renewable fuel market is growing worldwide, Japan is not any more energy independent because it has limited farmland on which to grow fuel crops. To secure a steady supply of ethanol, Japan and Brazil announced early this month that they will sign a pact in October for Brazil to import the biofuel to Japan. Japan has invested $1.29 billion in Brazil to produce ethanol and biodiesel, the Brazilian Agriculture Ministry announced last week in a story in the Dominican Today. Brazil produces 4.4 billion gallons of ethanol each year and last year exported 685 million gallons, mostly to the U.S. and Europe. Japan will need about 475 million gallons of ethanol a year because of a new law that requires gasoline to contain three percent ethanol.

[Source: Dominican Today via Renewable Energy Access