The View From Brazil: Biofuels Are Not a Problem

BRASILIA, BRAZIL—Biofuels are taking a beating in world opinion, as rising food commodity prices are being blamed, in part, on surging interest in shifting farm field production from food crops to those used to produce ethanol. But here in the capital of Brazil, there is little patience for that critique, which is seen as unfair and—in the case of this ethanol-crazy South American country—simply wrong.

A cane cutter works in Batatais, Brazil to produce sugar cane-based ethanol, a product that requires less land, has less ecological impact, and costs less than the U.S. variant--heavily subsidized, corn-based ethanol.

(Andre Penner/AP)

"Don't tell me biofuels are causing inflation," Brazilian President Luiz Inácio Lula da Silva said recently. He went on to tell a United Nations audience that gathered here this spring, "Biofuels aren't the villain that threatens food security." On the contrary, he added, "they can pull countries out of energy dependency without affecting foods."

Brazil, it's estimated, has more as-yet-uncultivated arable land available than all the land now devoted to agriculture in the European Union. Not surprisingly, the Brazilians reject any suggestion that their national drive for ethanol is contributing to the crisis in global food prices. Their forte is sugar cane-based ethanol, a product that requires less land, has less ecological impact, and costs less than the U.S. variant—heavily subsidized, corn-based ethanol.

Brazil, the world's most dynamic rising agricultural power, is the world's leading exporter of ethanol and its No. 2 producer, behind the United States. It is now making a major push into the realm of producing biodiesel for trucks and buses.

The development of ethanol has been a major national priority in Brazil since the 1970s. Some 80 to 90 percent of new cars operate on flex-fuel, meaning they can run on pure ethanol or a mixture with gasoline. The Brazilians recently passed a historic marker, as the amount of ethanol being used in light passenger vehicles exceeded the amount of traditional gasoline.

The sheer enormity of Brazil's uncultivated but arable land makes the food-or-fuel debate being sounded by some nongovernmental activists and United Nations officials ring hollow here. "In Brazil, it's not food versus fuel; it's food plus fuel.... They can mix well in our area," says Marcos Jank, president of the Brazilian Sugar Cane Industry Association.

The Brazilians are eager to promote their side of the ethanol story; Jank spoke to U.S. News by phone recently while participating in a biofuels conference in Indianapolis.

If the United States were to trim its tariff protection against foreign ethanol, corn prices would probably drop and American drivers would most likely have access to cheaper ethanol from Brazil, Jank said.

"I see a very emotional world," he said. "People have been thinking that all biofuels are the same."

They are not making that mistake in Brazil, where alcool, as the ethanol at the pump is called, is on offer wherever drivers fill up.