Brazil may restrict cane in wetland area

Brazil would restrict sugarcane planting in one of the world's largest wetland areas if the government approves a proposal to protect the Pantanal area's ecology, according to Reuters. The agriculture ministry has been working for a year with state-run agencies on a law to restrict cane planting in the Latin American nation amid concern about the environmental impact of the crop's rapid expansion. Agriculture Minister Reinhold Stephanes and Environment Minister Carlos Minc met on Monday, and both support the proposal The final decision rests with President L uiz Inacio Lula da Silva. "Since it preserves the Amazon and the Pantanal, clearly defining where it can be planted in the latter region, and without cutting existing production, it seems to me that the agreement is good for everyone," Minc said in a statement. No new ethanol plants, which produce biofuel for Brazil's fast-growing fleet of ethanol-powered cars and for export, will be allowed in Pantanal's plains under the proposal, but it will permit restricted planting in the region's highlands. The proposal would require planters in this region, where cane has been cultivated for more than 10 years, to use direct, or no-till planting methods, eliminating the use of machinery and agrochemicals, the ministry's statement said. No new mills would be allowed in the Amazon biome, but three plants that already had permits will be allowed to operate.

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US: McCain’s views on ethanol and subsidies may cost him votes

Republican presidential candidate John McCain opposes the US$300 billion farm bill and subsidies for ethanol, positions that both supporters and opponents say might cost him votes he needs in the upper Midwest this November, according to the Associated Press. His Democratic rival, Barack Obama, is making a more traditional regional pitch: He favors the farm bill approved by Congress this year and subsidies for the Midwest-based ethanol industry. McCain instead has promised to open new markets abroad for farmers to export their commodities. In his position papers, McCain opposes farm subsidies only for those with incomes of more than US$250,000 and a net worth above US$2 million. But he's gone further on the stump. "I don't support agricultural subsidies no matter where they are," McCain said at a recent appearance in Wisconsin. "The farm bill, US$300 billion, is something America simply can't afford." "I don't see any scenario in which McCain can get to the White House without carrying some upper Midwestern states," said US Senator Tom Harkin of Iowa, an Obama backer. "I've never really understood in all my years why Sen. McCain has gone out of his way to speak against and vote against policies that are important to the upper Midwest." There's a history of close elections in the region. President Bush carried Indiana, Iowa, Missouri, North Dakota and South Dakota in 2004, earning 35 electoral votes. But his Democratic opponent, John Kerry, prevailed in Minnesota, Wisconsin and Illinois, giving him 41 electoral votes. McCain has been most outspoken on ethanol subsidies, and that has Republicans worried in Iowa, the nation's biggest producer of the fuel. Other top ethanol producers include Illinois, Minnesota, Indiana, Ohio, Wisconsin and Missouri. "It does challenge him in states like Iowa, the No. 1 ethanol state," said Bill Northey, Iowa's Republican agriculture secretary. "It does make it tougher to make the case." Drake University political science professor Dennis Goldford said McCain's problem on farm issues reflects a deeper issue he faces as he's courted conservative GOP activists, many of whom are deeply suspicious of him. "He's essentially reverting to standard Republican supply-side economics," said Goldford. "That's where he's got a problem. He's got to find his own voice and so far he hasn't had a voice."

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CUBA: Ethanol plans scaled back

Cuba has scaled back its plans on ethanol production, instead focusing on sugar, according to Reuters. Luis Galvez, director of the sugar ministry's Sugar Cane Derivatives Research Institute, said as sugar output increases, so will derivatives, but in no case at the expense of food. "We are modernizing the sugar industry but in no moment are we going to compete with food," he said in a news conference. Galvez, who announced plans for a derivatives conference in October, refused even to use the word ethanol, stating plans for "alcohol" were reduced due to the market, land use and the country's strategy. "We are producing around 100 million litres and with modernisation we are going to double production," he said of the derivative which is used in rum, medicines, cosmetics and as fuel additive. Two years ago, Galvez, opening a conference on ethanol in Havana, was more upbeat about Cuba's ethanol future. "Our country has begun an accelerated drive to increase alcohol production, modernizing existing distilleries and installing new ones to increase by five times installed capacity," Galvez said at the time. Galvez said on Wednesday plans to install new distilleries were scrapped and Cuba would now focus on modernising seven existing ones, four of which operated this year.

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US: EPA rejects waiver for ethanol blending mandate

US officials rejected Texas Governor Rick Perry's request to ease the requirement for the use of maize- based ethanol in gasoline, saying the governor didn't prove that the rules were straining grain supplies enough to cause “severe economic harm,” according to Bloomberg. “After20reviewing the facts, it was clear this request did not meet the criteria in the law,” Environmental Protection Agency Administrator Stephen Johnson said today. The renewable fuels standard “remains an important tool in our ongoing efforts to reduce America's greenhouse gas emissions and lessen our dependence on foreign oil, in aggressive yet practical ways,” he said. Perry, a Republican, petitioned the agency in April to waive the requirement, saying it was raising corn prices, resulting in higher costs for food and animal feed. He wanted to reduce by half this year's requirement to produce 9 billion gallons of the biofuel. The EPA said in a statement that, while commodity prices have risen, an analysis of Texas' request found no compelling evidence that the mandate is causing “severe economic harm” during the time period specified by the state. Johnson told reporters on a conference call today the ethanol mandate was adding on average about 7 cents to each bushel of corn, with the agency's highest-cost scenario showing a 30-cent increase because of the federal rules.

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US: Obama advisor may take on biofuels role

One of Barack Obama’s most important backers is in talks to become an adviser to the Renewable Fuels Association, the most powerful ethanol lobby in the US capital, according to the Financial Times. Tom Daschle, the former Democratic Senate majority leader who has long been an influential champion of the ethanol industry, told the Financial Times about the move in an interview. The news underlines what ethanol proponents already believe: that in spite of Obama’s remarks that the US might have to reconsider its ethanol policy in the wake of criticism about its impact on global food prices, the Democratic candidate and his advisers fundamentally support the industry. John McCain, Mr Obama’s Republican rival, has said he supports ethanol as a fuel but opposes subsidies. “I think that John McCain will probably try to shut down the ethanol industry. He’s been very overt about that,” Daschle said. “Barack on the other hand recognises the importance of ethanol and of biofuels generally.” Daschle, who some tout as a potential chief of staff to Obama, sits on the board of Mascoma, a company that is developing technology for cellulosic –ethanol technologies.

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US: Poet to produce 20,000 gallons of cellulosic ethanol this year

The US’s largest ethanol producer, Poet,20is set to produce 20,000 gallons of second-generation ethanol this year, according to Reuters. But that number could grow if the plant helps the company learn how to spread the process to some or all of its 23 other ethanol distilleries. Poet is investing US$4 million in the pilot plant, which sometime during the last three months of the year will make fuel from corn cobs and corn fiber instead of corn kernels. The process will use microscopic life forms to break down the waste, instead of heat and pressure, which some other cellulosic producers plan to use. Critics of the next-generation fuel say costs have delayed widespread development, so it's uncertain when the fuel would add supply and cut prices in the enormous gasoline market. Poet says the country could eventually produce about 5 million gallons of ethanol per year from cobs, compared to 10 million gallons of overall production today.

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ANGOLA: Odebrecht to build ethanol plant Brazil’s

Odebrecht will build an ethanol plant in Angola on land a division of the company already owns, according to Bloomberg. Sonangol SA, Angola's state-owned oil company, and local sugarcane producers will be partners in the project.

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