Ethanol or “11-rod shirt”

Ecuadornews:

Agrofuel. This is the name of the new government proposal to stimulate the country’s agricultural sector through increased biofuel production.

Yesterday, the Minister of Agriculture, Xavier Lazo, together with the Vice President of the Republic, Otto Sonnenholzner, presented the project. Lazo said that the initiative has the objective of converting 30,000 hectares of rice plantations with low productivity into cane plantations for the production of biofuels.

However, the cañicultor sector believes that it would be a bad idea because today the sugar mills have not been able to pay farmers for excess supply. The oversupply supposes a “11-rod shirt”for the Government and for those who will finance a plan that had its genesis in the regime of Rafael Correa.

Currently the Government buys ethanol producers, which is obtained from the cane, for the eco-country. In February of this year, the representatives of 23 artisan associations renewed the contracts to deliver this biofuel for an additional 14 months, but had problems of payment and demand.

The eco-country is composed of 5% ethanol and 95% pre-mixed gasoline. The goal of Agrofuel is to exceed 5% ethanol in fuel and reach percentages of 10, 15 or 20% as in other countries, said Yuri Parreño, vice minister of Industries and Productivity.

One of the goals is to find that the types of gasoline in the country have 5% biofuel; however, he did not announce a date.

In this year, Petroecuador pays 83 cents for each liter of bioethanol. Regarding the cost of imported ethanol, the amount fixed is higher, between 10 and 15 cents approximately. For this reason, from the State will be a study of costs of production of ethanol to set an “appropriate price” for the production chain, said the deputy minister.

The vice president of the Republic, Otto Sonnenholzner, said that the country should stop relying solely on oil production for its development and should analyze other energy alternatives.

Carlos Chávez, chairman of the board of directors of the National Association of Growers of Palma Aceitera (Ancupa), says that the sector is currently going through a complex period due to a disease called heart rot. For this reason, “the government plan can give vitality to the sector”.

Three reasons

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Biofuels and sugar are obtained from the cane, which would increase the oversupply of the sweetener in Ecuador. The use of the thousands only to generate alcohol and ethanol is not the most advisable, it is not profitable, according to the Ecuadorian industrialists.

Non-payments

The producers who cut last year’s harvest have nine months unpaid, since the sugar mills of Coazúcar, Valdez, San Carlos and others were unable to place the sugar in the domestic market. Nor is it exported due to low competitiveness.

Without buyer

The government of Rafael Correa promoted the cultivation of cane for ethanol, but the farmers had problems placing the sugar and forced the mills to buy them. BanEcuador and the Financial Corporation will be affected. (I)

Source: https://www.expreso.ec/economia/etanol-economia-gobierno-biocombustible-palma-CA2736206