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The National Biofuel Development Committee has suggested the government make it mandatory for biofuels to constitute 2% to 2.5% of the nation's total fuel consumption, according to the Jakarta Post.
This would equal 1.2 million to 1.5 million kilolitres (kl) per year.
Evita H. Legowo, the first secretary of the committee, told The Jakarta Post on Sunday it had been suggestedthe policy come into effect in July before the committee's tenure ended in August.
The policy would be imposed in every region across the country, not only in Java and Sumatra as previously proposed, she added.
"I don't think the policy will cause any problems as Pertamina is currently distributing Biosolar fuel with a biofuel content of 2.5% in most provinces in Indonesia," Evita said.
She said the proposed policy was quite realistic as the country was already producing between 1.5 million and 1.8 million kl of biofuel per year.
Evita said it had not been decided whether the policy would be applied in the industrial sector, the transportation sector, or both.
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The International Sugar Organisation's executive director Peter Baron says there's more reasons for optimism in the global sugar industry now than there was a few years ago, reports Sugaronline.
Expected growth in sugar consumption aside, it's opportunities from product diversification that will continue to allow sugar to dominate as a commodity in global demand. Ethanol, co-generation, paper products from bagasse, and the opportunity to develop other products through technology is only the start.
"Since competing for the world market gets tougher, especially when preferential trade preferences are gained or denied, diversification becomes more important," he said.
"Energy is one of the drivers of economic development," says Baron, and ethanol is one of those sources supporting development.
"Less protective trade policies will help develop international trade in ethanol," he said.
Domestic sugar prices higher than the world price keeps industry investing in production and other opportunities in-country, but the further development of regional sugar trade through international trade agreements and preferential trade gives Baron more reasons for optimism.
Average retail domestic price is 2.5 times higher than world market price with an additional 10% premium for importing countries, according to recent ISO statistics, Baron said.
Regional trade development in sugar is supported by the simple fact that it is cheaper to ship smaller quantities of bagged sugar regionally than it is to transport white sugar in bulk over longer distances, which will continue to support regional refineries like those seen in the Middle East, he said.
But countries who rely on exports, like Least Developed Countries and Africa, Caribbean and Pacific countries exporting to the European Union will find that a weakening dollar will help them as they seek to continue exporting to the EU despite a 36% cut in EU prices. At the time of the sugar reform, price cuts expected for 2009/10 saw raw sugar fetching US$395 per tonne but with current dollar/euro exchange rates, that price cut will actually fetch US$495 per tonne.
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Brazil's ethanol industry to pushing hard to see trade barriers against its ethanol by the US and the European Union, reports Sugaronline.
Marcos Jank, president of Brazil's United Sugarcane Industry Union (UNICA) says the US's tariff against Brazil's ethanol imports are due to be renewed in 2009, which opens the opportunity to work with the US in changing that policy. A tariff-rate quota for ethanol could be possible, he said, but that a policy shift is definitely possible in the next three to 10 years.
Brazil currently exports a limited amount of ethanol to the European Union and is looking to increase those imports, but Jank says the recent announcement of an environmental sustainability certification system on ethanol imports is causing a concern for the Brazilian industry.
The EU's new rules may become a non-tariff trade barrier, he says, but there is still time to see what the European Parliament has to say.
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Sugar inventories that rose 19% last year will reach a record within months as farmers from Brazil to India contribute to a growing glut, according to Bloomberg.
Sugar probably will fall 18% to 10 cents a pound by yearend in New York, according to UBS AG and Westpac Banking Corp. Brazil's production has surged, and the ethanol made from the commodity may lose appeal as crude oil drops further from its Jan. 3 record high.
"It's hard to imagine an environment where energy prices drop and sugar prices outperform," said Christoph Eibl, who manages US$1.4 billion in commodities as co-founder of Tiberius Asset Management in Zug, Switzerland.
High prices are "going to encourage producers to not cut back," said Judith Ganes-Chase, who runs J. Ganes Consulting LLC from Katonah, New York. "You are going to wind up with more sugar than expected."
"If you see crude prices fall, you'll see sugar suffer in sympathy,'' said Patrick Armstrong, who manages US$900 million at Insight Investment Management Ltd. in London, which added to its sugar holdings last month. "We came into the year expecting 15% to 20% gains, and had most of that'' in the first month, Armstrong said. "I expect a slowdown from here."
Ganes-Chase said millers in Brazil, the biggest market for cane-based ethanol, may use a bigger percentage of the cane crop than last year to make sweetener rather than fuel.
Sugar won't sustain its gain "until the ethanol market goes global" with more demand outside Brazil, said Daniel Brebner, the executive director of commodity research for Zurich-based UBS AG, Switzerland's biggest bank.
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Dow Jones reports - Clearing raw land to produce biofuels actually contributes to global warming by emitting large amounts of greenhouse gases into the atmosphere, researchers warned Thursday.
Carbon dioxide emissions from new croplands carved into rainforests, savannas, wetlands or grasslands would easily surpass the overall amount of CO2 emissions reduced through the use of biofuels, according to a report in the Feb. 8 edition of Science.
"If you're trying to mitigate global warming, it simply does not make sense to convert land for biofuels production," said Joe Fargione, a founder of private environment protection agency the Nature Conservancy and co-author of the study.
"All the biofuels we use now cause habitat destruction, either directly or indirectly," he said.
"Global agriculture is already producing food for six billion people. Producing food-based biofuel, too, will require that still more land be converted to agriculture."
Converting land to grow corn, sugar cane or soybeans - crops used in the production of biofuels - creates a "biofuel carbon debt" by releasing 17 to 420 times as much CO2 into the atmosphere as the greenhouse gas reductions which the biofuels provide by displacing fossil fuels.
Carbon is stored in dead trees and plants as well as in the soil, and naturally seeps into the atmosphere in the form of CO2. Converting native habitats to cropland increases the release of CO2 into the air, the report said.
It would take years, and in some cases centuries, before biofuels derived from crops on converted land would lead to a net reduction of greenhouse gases, according to the report.
The researchers calculated that in Indonesia, where wetlands are being converted to grow palm oil to produce biofuels, it will take 423 years before biofuel CO2 emmission savings would repay the carbon debt caused by the land conversion.
"We don't have proper incentives in place because landowners are rewarded for producing palm oil and other products but not rewarded for carbon management," said report co-author Stephen Polasky, an applied economics professor at University of Minnesota.
"This creates incentives for excessive land clearing and can result in large increases in carbon emissions."
An incentive for carbon sequestration or a penalty for carbon emmissions is needed in order to slow CO2 emissions and environmental destruction, Polasky said.
The researchers noted that strong growth in the demand for corn-based ethanol in the U.S. has led to the increasing destruction of the Amazon rainforest in Brazil.
To address the ethanol demand, U.S. farmers have stopped rotating corn crops with soy, leaving their Brazilian counterparts to produce more soybeans to meet rising global demand, resulting in further Amazon deforestation, they said.
The report stresses that certain biofuels don't contribute to global warming because they leave the natural ecosystem intact, and that obtaining biofuels from biomass waste or forestry products such as wood chips causes less harm to the environment and is the aim of several scientists.
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Fidel Castro resigned as president and commander-in-chief of Cuba, after almost 50 years as the country's leader, according to Bloomberg.
“I neither will aspire to nor will I accept, the position of president of the council of state and commander-in-chief,” Castro wrote, according to Granma in its online edition. “My only desire is to fight as a soldier for my ideas.”
Castro, 81, the world's longest serving president, seized power in Cuba almost a half-century ago promising liberty and economic justice only to turn the Caribbean island into a communist bastion and a flashpoint of the Cold War.
The resignation should be “the beginning of a democratic transition for the people of Cuba,” President George W. Bush said in a news conference in Kigali, Rwanda, and promised US help. The international community should support “free and fair elections, and I mean free and I mean fair, not these kinds of staged elections that the Castro brothers try to foist off.”
Raul Castro has been acting president since July 2006, when Fidel handed control to him after undergoing surgery to treat an intestinal ailment.
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A shortage of sugar is looming after the country's producers were last week forced to halt production due to crippling shortages of sugarcane and coal, according to Zimbabwe’s Financial Gazette newspaper. Hippo Valley and Zimbabwe Sugar Refineries (ZSR), the country's major producers of sugar, have exhausted their supplies of sugarcane and were now waiting for fresh supplies from the next harvest, which would be after April. The shortages of sugarcane are believed to have worsened an already precarious situation as companies had been battling acute power shortages, foreign currency and spares supply constraints. Sources said milling companies had put aside substantial buffer stocks to use during the time of shortages. But reports said the government, worried about annoying the electorate ahead of next month's polls, had ordered the firms to produce sugar from their buffer stocks, leading to the depletion of stocks. A source said production could resume this week if coal supplies were restored, although this was not guaranteed. Despite the unavailability of sugar on the domestic market, some unscrupulous merchants have however, been managing to secure the commodity but have been selling it outside the country to earn foreign currency. Sugar shortages in Zimbabwe could force the country to revert to expensive imports. This would divert foreign currency, which could have been utilised in improving productivity by importing spares, into importing basic food commodities. The current sugar production constraints have also been blamed on the failure by new farmers to produce on land they took up from white commercial farmers in 2000.
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UK sugar giant Tate & Lyle will switch its entire range of cane sugars to Fairtrade, producing GBP2 million (US$4 million) in premiums for farmers in its first year, reports Sugaronline.
The first product to be licensed to carry the FAIRTRADE Mark will be Tate & Lyle Granulated White Cane Sugar, sourced from Belize; Tate & Lyle’s first accredited grower-partner, from whom it has purchased sugar for over 35 years. The switchover took two years of planning.
The complete switchover to Fairtrade is expected to be complete by the end of 2009.
“Our customers are demonstrating a real desire to buy ethically sourced products like Tate & Lyle's Fairtrade sugar as they want the assurance that growers and their communities in the developing world are getting a fair deal," said Waitrose Sugar Buyer Chris Moore.
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