Brazil signs sustainable ethanol deal with Sweden


A group of Brazilian ethanol producers has signed the first deal to export certified sustainable ethanol, reports Reuters.

Brazil signs sustainable ethanol deal with Sweden

Brazil signs sustainable ethanol deal with Sweden

June 27, 2008

A group of Brazilian ethanol producers has signed the first deal to export certified sustainable ethanol, reports Reuters.

Four firms — Cosan, Guarani, NovAmerica and Alcoeste — will sell 115 million liters of anhydrous ethanol certified to meet to certain social and environmental standards. The buyer, Sweden’s Sekab, said the agreement is a response to consumer concerns over the sustainability of sugar cane ethanol.

“There have been many articles about forced labor in Brazil and also ecological issues, deforestation of the rain forest, local pollution… We are in the business and know many are exaggerated, some are false,” Anders Fredikson, vice-president at Sekab, told Reuters. “But the public in general (in Sweden) doesn’t know what to believe and it buys the biofuel for ethical reasons… so it’s important to assure its sustainability.”

Fredikson said the sustainable ethanol will result reduce carbon dioxide emissions by at least 85 percent relative to conventional petrol.

Brazilian mills will receive a 5 to 10 percent premium for the certified product, which cannot be produced using child or slave labor and must meet certain environmental standards. An independent auditor will monitor performance.

The announcement comes as part of a broader move by Brazilian firms to push certification schemes as a way to counter criticism from activist groups. Beef producers and the soy industry have recently launched similar initiatives.

Brazil’s sugar cane ethanol is presently the most efficiently produced biofuel in the world, yielding 5.5 times as much energy per unit of input compared with U.S. corn ethanol. With a production cost less than a third the cost of conventional gasoline, nearly eight out of every ten new cars sold in Brazil are flex-fuel—capable of running on either an ethanol-gasoline mix (“gasohol”) or bioethanol. Brazil has effectively replaced 26 percent of its gasoline with sugar-cane based fuel grown on 5 percent of its crop area.

Nevertheless, the industry has at times been the target of campaigns by NGOs that allege labor abuses and questionable environmental practices, including burning of cane fields, water depletion and pollution, and displacement of farmers and ranchers into more ecologically sensitive areas, like the Amazon rainforest. The new deal seeks to allay these concerns by tracking the environmental performance of production.

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