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American ethanol isn`t up to Brazilian smackdown

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Bloomberg Mumbai
Last Updated : Jan 29 2013 | 12:59 AM IST

The same is true of ethanol made in the US, mainly from corn, and ethanol from Brazil derived from sugarcane. They look the same, though that's where the similarities end between what I like to call ethacorn and ethacane.

Although ethacane doesn't produce a fraction of the negative economic, environmental and social problems that ethacorn does, as international food prices soar and environmental concerns mount, both are being thrown into the same pinata to get hammered. Ethacorn deserves the beating, not ethacane.

It's hard to know whether those wielding the sticks are just temporarily blindfolded or whether they have an interest in defending the fossil-fuel industry or the agricultural subsidies of rich nations.

There are four main arguments against the wide use of Brazilian ethacane:

* Food prices are being driven out of sight as farmers grow more-profitable sugarcane instead of other crops.

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* Amazon rainforest is being destroyed to make way for cropland.

* Ethacane pollutes as much or more than oil-based fuel.

* Cane production uses the equivalent of slave labour and is morally unjust since it takes food from the mouths of the poor to put in the gas tanks of the rich.

Each of these points is a myth. To start with, let's make a broad point. "Brazil has the oldest, most advanced and efficient ethanol programmes in the world," according to the report of an international conference on biofuels in February 2007 at the Woodrow Wilson International Center for Scholars in Washington.

That brings up the first question: If ethacane were responsible for higher food prices, wouldn't food cost more in Brazil than elsewhere? It doesn't.

According to the United Nations Food and Agriculture Organization, or FAO, Brazil is one of the world's cheapest producers of corn, soybeans, beef, chicken, pork, milk and rice. In a clear sign of agricultural competitiveness, Brazil is also a leading exporter of food.

"When we talk about the influence of biofuels on the economy of grains, we are talking about the corn from the US, not the sugarcane from Brazil," said Abdolreza Abbassian, secretary of the Intergovernmental Group on Grains within FAO.

A recent study by the International Monetary Fund shows that Brazil's ethacane hasn't been responsible for higher international food prices.

Brazil also has all the room needed to grow sugarcane and increase agricultural productivity without tearing down a single tree in the Amazon.

Five hundred years ago, the Portuguese learned that the Amazon isn't the best region to grow sugarcane, which requires a long dry season.

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First Published: May 28 2008 | 12:00 AM IST

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