December 7, 2008

Brazil’s Biofuel Leadership

It has been a long time since Brazil had this kind of interest from the media and industry all over the world. Back in the 80´s, when the government setup a great deal of ethanol plants for sugar cane, called PROALCOOL, it was revolutionary, comparing it to other countries. But, maybe because of some administrative and political problems, we couldn’t make it happen. So we needed to start again.

The main problem, I think, is the way of the plants and production, have always been in the hands of the bigger producers. The Brazilian government is doing a social inclusion program, bringing the smaller producers to the game with incentives in order to other cultures such as sugar cane, to diversify the production.

The researches are more intense than ever. Nowadays we have a variety of sugarcane that tolerates frosts, so we can grow it in the southern Brazil, expanding the climatic zone for this culture, proving that we are doing a very good job in becoming a leader.

We also have researchers working on cassava based ethanol. The distillation process could work on a small scale plant, making the producer self-sufficient on energy. And there is more. The subproduct of cassava is an excellent raw material for animal nutrition, establishing a sustainable cycle. This culture can regenerate poor soils, and with good management, can foster a very good production. And that is why it is not only about the sugar-cane euphorism that we should be proud of.

Biofuels in Brazil have been very attractive to all investors. They are making the public sector happy and the farmers who produce the raw material for it. The usage of low concentrate biodiesel mixed with petrol diesel is going higher each year. They can´t just make a law saying that all diesel should be composed by 100 percent of biofuel. That is not going to work because of the economy impact on the grain market prices. If we consider all the grains that we export and use to make biodiesel, of course that there will be international economy impacts on the world grain market prices. But the problem is that we do not have biodiesel plants to do the esterefication of crude vegetable oil.

December 4, 2008

The underlying facts of food production and how they affect the final consumer

It is certain that many people do not seem to worry so much about what they eat, let alone to know the process of how food is brought to them. Why does this happen? A possible explanation would be the fact that not necessarily is there any kind of lack of information; on the contrary, there seems to be just too much information, which can be confusing, many times. Also, knowledge - and here we are not talking about food only - depends on cultural issues that vary from place to place. For example, the average Brazilian consumer does not normally read about the food products he or she buys; be it in the label of the products, be it wherever the information is available. Instead, they are more worried about food facts such as calories or quantities of fat. On the other hand, in the USA, most people are more concerned about the source of the food they eat, as they seem to greatly care about if it is organic or not. This could be explained partly because, in Brazil, there is no significant number of “organic supermarkets”. But here we go: are people really benefitting from organic products?

The question above brings us to a current discussion on how people have been fed. From the past years to now, it wasn’t like it is today when it comes to food security. People live longer today than in the past decades, and that is because of the biotechnology that has been used. So, why do some ONGs always criticize biotechnology? The answer is: because there is a great deal of interests behind the “ecologic way of living”. I don’t know why some people insist on saying that organic vegetables do not contain any kind of chemicals. It´s not true. Almost every producer of organic horticulture needs to use an organic fungicide called “yard”, which is made from copper sulphate and limestone. But, how can they call this fungicide organic if the main ingredients are inorganic? So that’s where most consumers don’t have the real information. Of course that there are some producers who are 100% organic, but it is really hard to have good yields without the usage of any kind of pest control in Brazil.

It´s hard to believe in how some ONGs could transform the biotechnology in GMO into a scary topic. It is confirmed that most transgenic DNA can´t cause any damage to the human health. On the other hand, it can bring benefits such as more concentrated types of vitamins and proteins. In Brazil, it is established by law that every vegetable oil made of genetically modified soybean needs to contain the letter “T” in a yellow triangle label indicating that the product is from transgenic sources. Nevertheless, this is completely wrong because no type of vegetable oil contains any kind of protein and aminoacids, so there is no need for such precautions.

Maybe it’s time people knew more about the food they buy and eat, without being kept in the dark nor seeming dumb either. Anyway, whose initiative would that be?

December 3, 2008

Studies boost corn-based ethanol for biofuels

November 9th 2008

It´s not true when someone says that corn-based ethanol will not affect prices of food. Let´s take a look at the boom on the Mexican tortillas prices on the occasion of the first North American corn crop for ethanol. The raw material for the tortillas, corn meal, is imported from the USA. So we understand that food price increases are more devastating for the world's poorest consumers.

We already know the environment benefits that ethanol brings if compared to gasoline. But the American culture is far from understanding, at least in this generation, how to avoid or eliminate the need for high horse-powered engines running on gasoline. There is a bunch of new ethanol-powered cars, but it is the government's obligation to make strong publicity and marketing to convince the population to use renewable energy.

The thing is that the USA is not able to expand its corn area without decreasing the soybean fields. So if that really occurs, we will have a collapse in soybean prices, less soybean grain could affect the prices of meal and protein livestock feeders buy, making it hard for the poor population to have access to meat. Perhaps, if they invest in technology, and that’s what American agriculture is pioneering on, they could increase corn production instead of planting in new fields. They are investing on plant breeding to increase the corn oil production and selecting hybrids that have higher productivity. But anyone that has a little knowledge on grain production knows that is not only about the breeding, it´s about the management and mainly the use of fertilizers. In order to have a good production, instead of expanding the corn field area, they will need to invest in the use of more fertilizers. Therefore, the fertilizer is the highest item in cost percentage in grain crops; increasing production in the USA will be expensive.

Brazil has a big potential on making biofuels. And it is on sugar cane based ethanol that we could become the biggest ethanol exporter. We know that there has been a great deal of interest by ihe USA on Brazil´s ethanol production. But if they import a nice amount of our ethanol, they could affect their ethanol plant and put all investments at risk, as they would not need new ethanol plants. Every country wants to be independent on energy, because of the crude oil crisis. Brazil has an abundance of land and diversified production. We don’t need to deforest anymore, because we have a big potential in the Cerrado area, where the new fields of sugar cane are being cropped. So, Brazil could export sugar cane ethanol without affecting the food prices, but if The USA cut corn subsidies for ethanol, we could have stable food prices for corn and all of its subproducts.

Global agriculture needs to become more productive in order to increase the food supply

November 9th 2008

How could farmers increase the food supply if the price of agricultural raw material is always high? Of course that there are other ways to increase production, as was mentioned on an article from OECD, but if we take a look at how we had increased production over the past years, we´ll realize that the picture is not so bad.

Plant technology, such as genetically modified organisms, was a big step to increase the food production, to reduce costs and to preserve nature. I mean, to preserve nature because, if we analyze it, specifically soybean crops, we could realize that we made a lot of positive changes. The way how we stopped using agrochemicals, mainly herbicides, reducing the constant need of going with a tractor to the field for soil compactation, thus reducing the use of water and the emissions of CO2 produced by the tractor engines. The GMO soybean has been a very sustainable technology.

Malthus was wrong when he mentioned the exponential increase of population in relation to food. The population growth wasn’t very exponential if we look from 100 years ago to now, and the food production wasn’t linear either, in other that some developed countries had doubled the food production in the last decades.

Today we know that is not about the shortage of food, it´s about how this food is available to all the people. There is one article from Van Cotten, a Belgiun researcher, who says that “how could the world population still be hungry if all the food that is produced could feed everyone? ”. So, we can see that it´s not really about the production, it´s more about the distribution of this food, and how we could make it available. to everyone. It’s a very delicate issue and it requires a lot of expertise to resolve that, from the private sector to government sectors.