Brazil, US to Cooperate on Biofuels - Official
Date: 25-Sep-08
Country: INTERNATIONAL
Author: Haitham Haddadin
Marcus Jank, president of the Brazilian Sugarcane Industry Association, or Unica, said a bill designed to boost energy cooperation and approved by the Senate Foreign Relations Committee on Tuesday made the collaboration possible.
Jank, whose group represents top producers of sugar and ethanol in Brazil, said the bill tries "to see the US and Brazil as partners in the creation of a global market for biofuels."
The bill expanded a 2007 Memorandum of Understanding signed by US President George W. Bush and his Brazilian counterpart, Luiz Inacio Lula da Silva, and earmarked US$58 million for the program, a statement from Unica said.
Jank said cooperation will focus on research and development in the short-term and investment and trade next year.
"Brazil and the United States are in different positions many times, like we were on the Doha Round," Jank said, referring to the World Trade Organization trade talks. "And in the biofuels area too, we are not completely aligned."
Exports to the United States represent about 50 percent of Brazil's total ethanol exports, but Brazil has many objections to US agricultural subsidies and tariffs, especially in the areas of cotton and ethanol.
After the collapse of the Doha Round of trade talks this year, Unica officials said it was likely that Brazil would file a lawsuit with the WTO over the US ethanol import tariff.
The United States and Brazil, the world No. 1 and No. 2 producers respectively, account for 75 percent of global production of ethanol and more than 50 percent of the worldwide output of biodiesel, Jank said.
The US ethanol capacity has risen to nearly 11 billion gallons a year as producers expect high oil prices to open markets for the fuel. Brazil produced about 5.8 billion gallons last year, but output may triple by 2020, Unica says.
(Writing by Haitham Haddadin)
