The Energy Information Agency recent released a report on Brazil’s energy sector, noting that the South American country is the 8th largest total energy consumer and 9th largest liquid fuels producer in the world. Renewable energy sources, including hydropower and biomass, accounted for slightly less than 40 percent of Brazil’s energy supply in 2014, a decrease of 0.5 percent from 2013.
In the section on biofuels, EIA said total biofuel production in 2014 was 16.7 million tons of oil equivalent (Mtoe), a 5.5 percent increase from 2013. The country’s 2014 ethanol production grew 4 percent in 2014 compared to 2013, setting a new record at 492,844 barrels per day. Exports in 2014 were down 52 percent from the previous year. Ethanol exports to the U.S. represented just over half of total Brazilian ethanol exports.
Ethanol imports, nearly all from the U.S., were down 243 percent from 2013. Though the country is a major ethanol producer, EIA noted there are several factors in its continuing imports: “Historically, droughts in Brazil have forced the country to import ethanol, mostly from the United States. Additionally, if sugarcane is not quickly processed into ethanol, the crop is prone to rot. The seasonality of sugarcane harvests leaves Brazil with a January-to-March off-season. In Brazil, ethanol production is also highly sensitive to commodity prices. For example, because sugarcane is used for ethanol production, high sugar prices may entice producers to switch to sugar production instead of ethanol production.”
The ethanol blend requirement in gasoline was raised to 27 percent in February of this year, and EIA reports the government is considering an increase to 27.5 percent “as a measure to reduce gasoline imports. However, the ethanol industry is struggling, because of land and labor cost increases as well as government-imposed gasoline price controls, which are undermining the competitiveness of ethanol as an oil substitute.”
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