Oct 28, 2010
Brazilian Producers Want a B20 Biodiesel Blend by 2020
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
The Brazilian Biodiesel Union (Ubrabio) will petition the Brazilian government to raise the percentage of vegetable oil in diesel fuel from its current B5 blend to a B20 blend by the year 2020. The group has indicated for several years that the industry has the capacity to increase the blend immediately and to keep increasing it in the future.
The biodiesel program in Brazil started in 2005 with the mandate to have a B2 blend (2% vegetable oil) by 2007 and a B5 blend by 2013. The program has been more successful than anticipated and the B5 blend was achieved in January of 2010, three years earlier than anticipated. Once the program had been initiated, no further mandates for the program had been adopted and the biodiesel producers now feel that additional mandates are needed.
The members of the Brazilian Biodiesel Union indicated that they are only operating their facilities at 53% capacity and that they could easily accommodate an immediate increase to a B10 blend. According to a study conducted by FGV Projetos, if the B20 blend was adopted, Brazil could eliminate the need to import any diesel fuel. To achieve the B20 blend, the study indicated that investments worth R$ 14.8 billion would be needed to increase the industrial capacity and the increased production of alternative vegetable oils
Currently, 80% of the vegetable oil used in Brazil's biodiesel production is soybean oil, but the government would like to see that reduced to 70% in the future. In order to reduce the percentage of soybean oil usage, alternative vegetable oils need to be developed and part of the indicated investments would be used to help develop those alternatives.
The primary alternative vegetable oil is expected to be palm oil. Embrapa has recently released palm oil varieties suited for production in the eastern Amazon Region. The idea is to locate palm oil plantations in areas of degraded pastureland. That way no additional deforestation would be needed and in fact, palm plantations are expected to actually improve the environment compared to the existing subsistence cattle ranching. A million hectares of palm oil production in the state of Para could produce five million tons of oil needed for biodiesel production.
Another alternative vegetable oil could be obtained from the jatropha plant, which is a semi evergreen shrub or small tree that produces nuts that are very high in oil. The oil content of the nuts ranges from 27% to 40% (average is 34%). The plant is native to the America tropics and it can be grown in areas of low rainfall and in low fertility environments. This could make it ideal for small family farmers in the semi arid regions of northeastern Brazil. A hectare of jatropha is capable of producing 4,000 kilograms of oil. Embrapa has established a number of research plots in five Brazilian states analyzing the potential of jatropha for biodiesel production.