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To: Seeker of Truth who wrote (424)	9/13/2005 6:01:20 AM
From: elmatador	Read Replies (1) \| Respond to of 219114

The devils is in the details. Before we go to the details we have to remove a whole curtain of smoke. We are talking about the least transparent business in the world. S. Paulo state area 250.000km2 produces the bulk of ethanol in Brazil. The stats are here: unica.com.br But we have to look to the figues under the light of what happens in Brazil, the role of Sao Paulo state, taxation, Petrobras countermeausures... Two types of users: 22% ethanol is always mixed with gasoline 100% ethanol powered cars Petrobras (the state-owned oil company) played with the gasoline prices to make ethanol unattractive. As a result, if you you'd buy a powered car powered by 100% ethanol you'd risk finding gasoline cheaper. You'd be stuck. If you have a huge fleet of cras that owuld hurt. To circumvent that, the carmakers produced flex-fuel cars. Fuel with whatever is cheaper. That because Petrobras couldn't not keep artificial lower prices forever: Petrobas drops the price? you fill with gasoline. Petrobras jacks up the price? you fill with ethanol.. As you can see in the stats, S. Paulo state produces the bulk of ethanol in Brazil. Taxation explains that: Gasoline (or anything considered energy) in Brazil is taxed where it is consumed. Sao Paulo state convinced Brasilia -don't ask how- that ethanol is not energy and is taxed in the origin where it is produced. They sell ethanol everywhere in Brazil and the state keeps the taxes. NOTE: S. Paulo doesn't produce oil (Rio de Janero state offshore basin does). This is a big incentive for other states produce ethanol and they are starting to produce ethanol. You can produce sugar and later tranform it ethanol. So depending on the prices in the international market you can profit for whichever is more attractive. This also have a flutuation effect in what is counted as sugar or ethanol over a period of time. Sao Paulo's sugar production has been rein in by the federal government to give chance for other states' production because the state is more efficient. This is the laying field. I still have to explain the potential of ramping up ethanol.

To: Seeker of Truth who wrote (424)	9/13/2005 6:29:47 AM
From: elmatador	Read Replies (2) \| Respond to of 219114

In contrast to U.S. corn-based ethanol, which requires substantial amounts of fossil fuel to plant, harvest and distill, Brazil's industry uses crushed sugar cane stalks known as bagasse to feed the steam boilers that power its mills and distilleries. The process is environmentally friendly and so efficient that these centers are generating more energy than they can use. Ethanol producers are supplying Brazil's grid with more than 600 megawatts of electricity. The near-term potential is at least 10 times that. Near the city of Ribeirao Preto in northeastern Sao Paulo state, the harvest is underway in Brazil's richest sugar-cane-producing region. Trucks lumbering under mounds of fresh-cut cane creep into Jardest Sugar & Alcohol. The vast milling and distilling complex, owned by Brazilian sugar trading giant Crystalsev, will run 24 hours a day nonstop until the season ends in December. The air is fetid with char from the fires that are clearing the fields of debris and vermin in preparation for the arrival of teams of scythe-wielding cutters. A lush emerald sea of cane rolls toward the horizon in every direction. ELMAT: The air stinks real good because the liquid residues of producing ethanol by-products of industrial production <<(vinasse and filter cake)>> is thrown back at the field as fertilizer.>> And there is a lot more where that came from. Brazil has about 13.5 million acres planted with sugar cane. More than 200 million dormant acres lie ready to cultivate.

To: Seeker of Truth who wrote (424)	9/13/2005 6:41:41 AM
From: elmatador	Respond to of 219114

“Assessing the Biofuels Option ” iea.org

To: Seeker of Truth who wrote (424)	9/13/2005 7:03:35 AM
From: elmatador	Respond to of 219114

Why we import Brazilian ethanol iowafarmbureau.com Last year, the Brazilians could export ethanol for less than $0.90 per gallon, whereas the production cost for Iowa ethanol plants is somewhere around $1.10 per gallon. Half our 2004 ethanol imports came directly from Brazil without duty-free reprocessing the Caribbean, even paying the full 2.5 percent plus 54 cents per gallon import tariff. If the world price of oil is high enough, and the price of ethanol in the U.S. is high enough, it will apparently be profitable for someone to import ethanol from Brazil. Economists will tell you that imports So why are we importing Brazilian ethanol? Simple economics: U.S. ethanol demand now exceeds U.S. ethanol supply, so imports will make up the difference. And Brazil can produce ethanol from sugarcane more cheaply than we can make it from Iowa corn. Last year, the Brazilians could export ethanol for less than $0.90 per gallon, whereas the production cost for Iowa ethanol plants is somewhere around $1.10 per gallon. Half our 2004 ethanol imports came directly from Brazil without duty-free reprocessing the Caribbean, even paying the full 2.5 percent plus 54 cents per gallon import tariff. If the world price of oil is high enough, and the price of ethanol in the U.S. is high enough, it will apparently be profitable for someone to import ethanol from Brazil.