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Brazil Considering Increasing Ethanol Mix To 25%

Cattlenetwork. The Brazilian government is mulling the hike of an obligatory 23% ethanol mix in all gasoline to 25%, according to an Agricultural Ministry official.

Ethanol prices in Brazil are at their lowest point in two years.

“With this fall of prices, the ministers that make up the Inter-ministerial Council of Sugar and Ethanol, or Cima, are already talking about the possibility of raising the mix back to 25%,” said Alessandre Strapasson, the general coordinator at the Agricultural Ministry’s sugar and ethanol department in a phone interview with Dow Jones Newswires.

The higher mix would help the domestic market consume an additional 40 million liters of ethanol monthly, thereby sustaining prices.


Eduardo Estevez

This will never work.


It is puzzling that the price of ethanol drops in a world market where the price of gasoline increases. People would just buy ethanol instead of gasoline. The relative price between gas and ethanol should be locked because they are perfect substitutes for each other. There should not be any need to increase the mandatory ethanol content of gasoline. The explanation could be that Brazil like other oil producing countries doesn’t use world market prices on their domestic market. Questions: Is Brazil regulating the import/export of oil and domestic prices? What is the $ gallon of gasoline in Brazil?


I imagine if the US allowed ethanol from Brazil in, the world price would rise.
Is ethanol traded internationally ?
Imagine a tanker with 100,000 gallons of ethanol going down - that would have an interesting effect on the environment.
But better to work on efficiency than ethanol [ IMHO ] or both.
It is a bit crazy running a SUV @ 15mph on ethanol.
Better to get one on 25 mpg, etc. etc. - I'll stop now.


The U.S. imports more than 10% of its gasoline, mostly from Europe, due to increased demand in the U.S. and a refinery capacity shortage.

If a gasoline tanker went down, it would produce quite a mess as well.

Farmers in the U.S. and Germany have given up other crops in favor of crops for fuel. This has caused the prices of grains and other crops to rise.

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