Brazil's Unica-protection stunts biofuel market

By Reese Ewing

SAO PAULO (Reuters) - A leader in Brazil's ethanol industry said on Wednesday that the world's top producers of biofuels needed to begin working together toward the common goal of replacing petroleum-based transport fuels.

"Instead, it never ceases to amaze me, we are still considering the shift from oil to renewables through a 19th Century protectionist model," said Eduardo Pereira de Carvalho, president of Brazil's Cane Industry Association (Unica).

The United States currently imposes a 54 cent import tariff on Brazilian ethanol.

Participating in Reuters Global Biofuel Summit, Carvalho referred to the lack of cooperation between the United States and Brazil "the world's two biggest producers of ethanol and we aren't working together.

"We all know the logistic problems the United States faces getting ethanol from its corn belt to its large consumer market on the west coast. Why haven't U.S. officials visited Brazil to find out how we distribute ethanol via pipeline across Brazil without any problem?" Carvalho said.

He added that U.S. advancements in distillation could benefit Brazil but there was little sharing of information between the two ethanol giants.

The world produces about 400 billion gallons of gasoline a year, while ethanol production is less than 10 billion gallons, mostly from the United States and Brazil, Carvalho said.

Carvalho was recently in California in an effort to meet with government officials over greater ethanol ties and said he was inviting Gov. Arnold Schwarzenegger to an Unica Ethanol Summit in Sao Paulo on June 4 and 5 that he hopes will be a platform for sharing information and discussing policy.  Continued...