Brazil Set to Profit from Surge in Ethanol Demand

Ethanol is in high demand in Brazil and across the world. As the largest sugar producer ethanol, Brazil is set to profit as the price of biofuel at the pump is now more competitive than gasoline on the open market, according to Sao Paulo-based trader and producer Copersucar SA (note: in the US, oil and gasoline are heavily subsidized). “Ethanol prices are 62-63% that of gasoline, a level that will start attracting demand,” said Luis Roberto Pogetti, chairman of Copersucar in an interview given in London earlier this month.

Copersucar isn’t the only Brazilian company predicting huge benefits to Brazilian businesses and consumer. “… Flex fuel cars can run on either a mix of ethanol and gasoline or pure biofuel. Filling up with ethanol usually becomes more advantageous than with gasoline at the parity of 65 percent,” researcher Datagro Ltd. estimates.

The news out of Brazil seems to indicate that the growing gap in consumer prices between ethanol and (decidedly over-priced) gasoline is a global, rather than national trend, as the world evolves beyond harmful fossil fuels and toward a cleaner, sustainable future. All of which is good news for pretty much anyone who isn’t a cartoonishly evil CEO of a major oil company, a jacka** Saudi prince, or an Albertan oil looter who’s more than happy to destroy his grandkids’ planet in order to line his pockets and lease his missus (mister?) a shiny new Lexus every 24 months. You know: bad people.

Here’s hoping the baddies at Big Oil and Coal get it in the end … or, preferably, go to prison – where they’ll still “get it in the end”.

Sources: Copersucar SA, via Bloomberg.

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Tags: brazil, cane, corn, cost, demand, Ethanol, free market, Gasoline, Oil, Policy, Politics, price, prices, subsidies, subsidy, sugar

About the Author

Jo Borrás I've been involved in motorsports and tuning since 1997, and write for a number of blogs in the Important Media network. You can find me on Twitter, Skype (jo.borras) or Google+.

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Rick

It’s nice to read about trends and new technology but how about some journalism? Give us the facts and let us decide what is subsidized, what is overpriced and who is evil.
- Jo Borras
  
  Are you some kind of mental patient? Whether or not something is subsidized is as black and white a fact as you can get! Go read another blog – I’m sure you can find plenty written at a 4th grade level.
GregS

Let us not forget that oil is not freely priced. Many believe that oil would be around $60/barrel if OPEC were not inflating the price by restricting production. With oil at that price, gasoline would be priced better than ethanol.
- Jo borras
  
  Well said. It’s not freely priced on the open market or in the US.
  - t_
    
    Oh, my friend, the US is the place wit the most freely priced gasoline. In Europe it’s the big thing, I do not want to say a thing about Asia at all. Taxes are making 2/3 of the price of the fuel. But anyway, petrol is overpriced. Putting another alternative in the big game will make the bad guys’ lives harder and ours probably easier with more choices and lower prices.
    - Jo Borras
      
      That’s correct.
- derwurst
  
  OPEC hasn’t controlled crude oil prices since 1988 when the New York Mercantile Exchange oil future traders took over for OPEC.
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GregS

So why not just let the comment go rather than insulting the poster?
Jo Borras

Why would I want to do that when its so much more fun to question their children’s paternity and/or call them ignorant hillbillies?

I don’t think you understand the Internet, but I respect where you’re coming from.