Quel avenir pour le modèle brésilien en matière de biocarburants?

Transcription

1 Groupe d Economie Mondiale (GEM) Sciences Po Quel avenir pour le modèle brésilien en matière de biocarburants? Marcos S. Jank President, Brazilian Institute for International Trade Negotiations Professor at the School of Economics, University of São Paulo Research team Luiz Fernando do Amaral, Luciano Rodrigues, Marcelo Moreira, Daniel Amaral Paris, France 23 March 27

2 Brazilian Fuel Ethanol History Incentives, mandatory blends, new technologies Deregulation, Sugar Exports Flex Fuel Global Market? Ethanol production (billion liters) PROÁLCOOL FIRST PHASE Mandatory blend and subsidies. ETHANOL CRISIS at the end of the 8s Oil prices down. Brazilian government cuts support. Higher sugar prices affect ethanol production and sales of E-1 cars went down rapidly Anhydrous Hydrous 72/73 73/74 74/75 75/76 76/77 77/78 78/79 79/8 8/81 81/82 82/83 83/84 84/85 85/86 86/87 87/88 88/89 89/9 9/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7e 1973 Oil crisis & low sugar prices PROÁLCOOL SECOND PHASE Fiscal incentives and tax exemptions for ethanol production and E-1 fueled cars. All gas stations must obligatorily sell ethanol. Low ethanol prices (65% of gasoline s) guaranteed at the pump. 23 FLEX FUEL Flex fuel vehicles begin to be sold. Source: Datagro, 26 (dados). Elaboration: ICONE.

3 35 Brazil: Sugar and Ethanol destinations Sugar production Sugar exports 89/9 9/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7e million tons Internal market and stocks 15 Ethanol production /9 9/91 91/92 92/93 93/94 94/95 95/96 96/97 97/98 98/99 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7e billion liters Ethanol exports Internal market and stocks Source: Datagro(26) and MDIC (27). Elaboration: ICONE.

4 Flex Fuel Vehicles (FFV) in Brazil Through some special electronic sensors, the on-board computer recognizes the fuel and properly adjust the engine combustion parameters, without any interference from the driver. Introduced in the Brazilian market on March 23. These vehicles are designed to be fueled with gas, ethanol, or any blend of gas and ethanol (today from E23 to E1) Seven brands and 49 models. 33, gas stations all over the country with at least one dedicated E1 pump Source: ANFAVEA

5 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % jan/3 mar/3 Brazilian Automotive Market by Fuel Brazilian Light Vehicles Market Sales mai/3 jul/3 set/3 nov/3 jan/4 mar/4 mai/4 jul/4 set/4 nov/4 jan/5 mar/5 mai/5 jul/5 set/5 nov/5 jan/6 mar/6 mai/6 jul/6 set/6 nov/6 26 average 4.3% 18.5% 77.3% Reasons for success: a) Consumer s guarantee for moves in fuel relative prices b) Operational cost reduction c) Best performance Flex (Alcohol or Gasoline) Gasoline Alcohol (Pure) Diesel Source: Anfavea (26), MAPA

6 Brazilian: Light Vehicles Fleet 35 Million units Total 22.6 Flex Fuel Source: ANFAVEA

7 World Ethanol Production Billion liters US Brazil e Others India EU China Note. E=estimates. Source: F.O. LICHT, UNICA., CARD.

8 World Ethanol Exports billion liters 6, 5,5 5, 4,5 4, 3,5 3, 2,5 2, 1,5 1,,5, hõe Brazil e Others C. Rica- Jamaica Saudi Arabia China South Africa US EU Note: e=estimates (US and Brazil final data for 26, South Africa data was projected considering preliminary data for 26, for other countries projections were made based on growth rate). Only the extra block trade was considered in the case of EU. Fonte: F. O. Licht, USITC, EUROSTAT e MDIC.

9 Sugar Cane: Source of Energy 1/3 JUICE 276 kg/t 5% humidity 1/3 BAGASSE Hydrolysis Hydrolysis 165 kg/t 15%humidity 1/3 STRAW SUGAR (153 kg/t) ETHANOL CO-GENERATION OF ELECTRICITY Source: UNICA MOLASSES Straw: tops and leaves of sugar cane Cellulosic ethanol revolution: when will it take place?

10 Brazil: Main Sugar Cane Regions Amazon Rain Forest 4 Fs Food Feed Fiber Fuel Sugar Cane Sources: IBGE and CTC Atlantic Rain Forest Expansion based in increased land productivity from the extensive use of pastures in the 7 s to an integrated system of LIVESTOCK (beef cattle, chicken and pork) and AGRICULTURE (soy, corn and sugar cane) for food, feed and fuel

11 Brazil - Potential to Increase Production Million hectares (25) BRAZIL 85 Total Arable Land 34 (4%) % of total lands 1. Cultivated Land: All crops 61 7,2% % arable lands 17,9% Soybeans 23 2,7% 6,8% Corn 11 1,3% 3,2% Where will sugar cane grow? Sugar cane Sugar cane for ethanol Oranges 2. Pastures 3. Available land (ag, livestock) ,7%,4%,1% 23,5% 9,4% 1,8%,9%,3% 58,8% 23,5% Main concern for sugarcane expansion in Brazil: Logistics (not land availability) 1% of gasoline substitution in the US by Brazil would require: 8 billion liters of ethanol, 92 MT or 1,2 Mha of cane; US$ 4 billions in exports 132 billion liters of ethanol require 2 million ha of sugar cane Note: 1 hectare = 2,471 acres Source: MAPA, UNICA. Elaboration: ICONE

12 Note: (*) Upgrade and expansion of existing plants Source: UNICA Investments on the Brazilian sugar cane industry Investments for the next six years New Plants (77) Existing plants (335)* TOTAL plants 77 US$ 12.2 billion US$ 2.4 billion US$ 14.6 billion plants 81% of the new plants are being built by traditional entrepreneurs of the sector

13 Participation of foreign investors in the Brazilian production 26/7 212/13 11 plants (3.3%) 16 plants (3.8%) 18.8 million tons of sugar cane (4,5%) 38.5 million tons of sugar cane (6,5%) MAIN FOREIGN INVESTORS: ADECO (Argentina George Soros fund) CARGILL (EUA) LOUIS DREYFUS Corp (France) TEREOS (France) NOBLE Group (Cingapure) INFINITY BIO-ENERGY (UK, Europe) NEXT?: Bunge, Mitsui, Google, Sun systems, CBA? Source: UNICA

14 Brazil: Location of the plants Current plant Source: NIPE-UNICAMP Plant in construction or in project

15 Ethanol Projections BRAZIL US Pres. Bush s target FAPRI* Production Consumption RFS target Exports Production Imports from CBI Billion liters Consumption USDA** Imports Notes: Linear growth assumed based on 212 and 217 estimations and targets. RFS; Renewables Fuel Standards. US imports assumed to be 7% of consumption. President Bush s target is 132 bilion gallons of renewable and alternative fuels by 27. * Projection presented by Prof. Bruce Babcock at the WWC Biofuel seminar (feb27). **Calculations based on USDA s projections of corn consumption for ethanol production and on the US average yields (liters/ton) in the past 3 years. Sources: UNICA, RFA, USITC

16 billion liters Projections Ethanol production Note: Projections based on the announced targets and capacities of each country. Source: CARD Iowa State (Prof. Bruce Babcok for US), FAPRI, ACTI, FO Licht, UNICA, ABIOVE, TOEPFER International and ICONE. US EU Brazil Others

17 Projections Biodiesel consumption EU Billion liters Others Malaysia US Indonesia China Note: Projections based on the announced targets and capacities of each country. Source: CARD Iowa State (Prof. Bruce Babcok for US), FAPRI, ACTI, FO Licht, UNICA, ABIOVE, TOEPFER International and ICONE.

18 Billion liters Biofuels Projections Ethanol Production Biodiesel Consumption Note: Projections based on the announced targets and capacities of each country. Source: CARD Iowa State (Prof. Bruce Babcok for US), FAPRI, ACTI, FO Licht, UNICA, ABIOVE, TOEPFER International and ICONE Billion liters US EU-25 Malaysia China Others Brazil Argentina Indonesia India

19 Brazil: Perspectives for Ethanol The most advanced country in the strategy of substitution and complementation of fossil fuels by ethanol, due to a compulsory blend (energy security) and to the growing demand related to the adoption of flex-fuel vehicles (which depends on relative prices) and exports. Brazil has an interest on ethanol as a global commodity. However, it is difficult to assume the worldwide use of ethanol while supply is concentrated only in Brazil and US. Sugar cane is the most competitive raw material for the production of ethanol; low costs (competitive with any gasoline obtained from a US$ 4 barrel of crude) and very positive energy balance. Hydrolysis of cellulosic materials is the main driver of the potential growth in global ethanol production in the future. The bagasse of sugar cane will probably be the cheapest raw material.

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