It has been said that by 2015 the substitution of gas for ethanol in the US will be around 9.8%; today, it is only 3%.
The market for ethanol/alcohol is big and it is expected to go through explosive growth soon. President Bush has announced that 20% of gas shall be substituted by ethanol by 2017, which will represent some 130 billion liters.
If the US can double the production of ethanol by 2010, it will be making roughly around 36 billion liters. In Brazil, according to the sugar cane farm union, production will reach 30 billion liters by 2013, as opposed to today's 17.5 billion, not even close to what is demanded.
In 2006, 14% of the production of corn in the US was for making ethanol, but to reach the 130 billion liters in 2017, 64% of all corn should be destined to ethanol. In case production numbers double, 32%.
The biggest market for Brazil's production of ethanol still is Brazil and it is estimated that by 2015, the flex fuel contingent of cars will be bigger than that of vehicles that run with gas. Today, 85% of the Brazilian production stays inside Brazil.
Some 40% to 45% of gas used in Brazil today is substituted by ethanol. Even in some years, there is no other country to get closer to this percentage. Brazilian export is going from US$ 600 million to US$ 1.3 billion by 2010, after the agreement done with Japan and Sweden, but exporting to the US remains a challenge. So it is expected and even natural that American corn producers do not see the production of Brazilian ethanol eye to eye.
In 2006 though, ethanol export to the US grew six times more than in 2005, which was considered atypical, and the numbers are not expected to happen again this year, but it also shows an improvement in the acceptance of the Brazilian product. With the end of subsidies for corn production planned for 2010, it is believed that Brazil might be able to act as a partner to complement the American production.
Meanwhile, Brazilian farmers invest in the production of sugar cane, and it is estimated that by 2012, the plantation will occupy some 9.8 million hectares (today 6.4 million), and, as the government guarantees, with no forest devastation.
An optimism unseen in many years is taking over the rural areas of the US, as ethanol production will be good for the economy, not to mention the positive impact of the reduction of the country's dependency in oil. Ethanol will cause a strong impact in the world's agriculture, and that includes Europe.
That Brazil is a pioneer, which makes it more knowledgeable and competitive in the field is unquestionable, after all it started 30 years ahead of everyone else.
But there is one very important thing to keep in mind in this new era, only those acting with responsibility towards the environment will be able to grow. Sine qua non. And no country will be able to get away from this reality. Not even pioneers.
Clara Angelica Porto is a Brazilian bilingual journalist living in New York. She went to school in Brazil and at the University of Wisconsin in Madison. Clara is presently working as the English writer for The Brasilians, a monthly newspaper in Manhattan. Comments welcome at clara.angelica@gmail.com.