Brazil Makes Corn Ethanol, Too

Farm Futures
Posted on April 11, 2012 at 9:00 AM

Brazil's ethanol is made from sugarcane, right? You know - the stuff whose rate of fossil fuels in to biofuels out is seven times better than that of corn ethanol, according to one industry site? Well, soon enough, the Brazilians say they will be making at least some ethanol from corn, too.

Here's part of the irony at work: Lots of Brazilians patted themselves on the back at the first of the year, when the U.S. tax credit for ethanol expired, along with a $.54 per gallon tariff on imported ethanol. Sure, there was little immediate chance that tankers of Brazilian sugarcane ethanol would be lined up soon at U.S. ports, as the Brazilians - after years of underinvestment in their cane fields - weren't producing enough to keep the price competitive domestically with gasoline. In fact, last year`s Brazilian ethanol production was down 19%, and flex-fuel car owners put more and more gas into their tanks.

As a result, Brazil became America's top customer for corn ethanol in 2011.

A big factor in Brazil's strong demand for ethanol has been the introduction of so-called flex-fuel cars, which can take any blend of gasoline and ethanol.

Well, last month the Brazilians introduced the first flex-fuel ethanol plant in that country - designed to make the alternative fuel from sugarcane when that crop is abundant, and to switch easily over to corn when there's a lot of that crop in the market. And there often is too much corn in Mato Grosso.

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