Brazil "throws cold water" on ethanol sector-Unica

Wed Apr 30, 2008 7:32pm EDT
Reuters.com
By Inae Riveras

RIBEIRAO PRETO, Brazil, April 30 (Reuters) - Brazil's ethanol industry cried foul on Wednesday after the government lowered a fuel tax on gasoline to limit the impact of a price rise at the refinery on consumers.

The government's move shattered the industry's hopes of improving its margins with the widely expected 10 percent hike in domestic gasoline prices that came from the state-run oil company Petrobras earlier on Wednesday. [ID:nN30543835]

Ethanol prices stay at or below 70 percent of the price of gasoline due to the lower mileage a liter of ethanol gets compared with gasoline, but gasoline prices have been held artificially low by the government which controls Petrobras.

Read the full story