Update 1-Brazil Fuel Retailers Ask Govt to Cut Ethanol Blending in Gasoline
by Marcelo Teixeira (Reuters) Fuel retailers in Brazil have asked the government to reduce the amount of ethanol required to be blended into gasoline, saying a smaller production in the current season has reduced the biofuel’s supply and increased prices.
Fecombustiveis, an association representing around 40,000 gas stations in Brazil, asked for the ethanol blend in gasoline to be reduced from 27% currently to 18%, saying the smaller sugar cane crop this year due to drier-than-normal weather reduced ethanol production.
Nearly 90% of ethanol produced in Brazil is made from sugar cane, with around 10% being corn-based. The country’s center-south cane crop is off to a slow start this year.
Fecombustiveis said it received reports from associated companies saying fuel distributors were having trouble acquiring enough ethanol from mills for the mandatory blending requirements, causing delays in gasoline distribution.
Brazil last month cut the amount of biodiesel it blends into diesel from 13% to 10% due to tight supplies and high prices.
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Brazil’s Enegy Ministry said it is following the supply situation and has not seen the need to cut ethanol blending.
“With the (cane) harvest just starting, it is doubtful a change would be made now,” a U.S.-based sugar broker said, adding that an ethanol blending cut would mean larger gasoline imports.
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“Removing the 20% tariff on U.S. ethanol would be a much smarter solution (than cutting the blend),” said the head of U.S. ethanol group RFA, Geoff Cooper. READ MORE
Brazil keeps biodiesel 10% blend for July and August (S&P Global)
Brazil sugar output falls 25% yr/yr as cane agricultural yields fall 10% (NASDAQ/Reuters)
Higher biofuel costs amplify concerns on Brazilian blending mandates (S&P Global Platts)
Fuel Retailers Ask Brazil’s Government to Cut Ethanol Blending in Gasoline (GrainNet)
Brazil mills cutting some sugar production, boosting ethanol volumes -Datagro (NASDAQ/Reuters)
