Biofuels in Colombia

July 4, 2008, 10:37PM
Colombia finds biofuels bonanza in sugar cane

By JOHN OTIS
Copyright 2008 Houston Chronicle

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See a Colombian sugar plantation in action El Cerrito, Colombia — Between breaks to sharpen his machete under the equatorial sun, Gregorio Hurtado laid waste to row upon row of 9-foot sugar cane stalks.

Like plantation labor of a bygone era, the cane harvest remains a backbreaking task. Even though Hurtado earns just $3 for every ton of the fibrous stalks he cuts, he's happy to have a job amid the chaos of Colombia's sugar industry.

For that, he can thank several new ethanol plants towering above the sea of green cane fields that cover this patch of western Colombia. Even as low world prices and the weak U.S. dollar have hurt sugar exporters here, Colombia's biofuels industry is growing by leaps and bounds.

Ahead-of-the-curve planning, technological breakthroughs and government incentives have helped Colombia emerge as the No. 2 producer of ethanol in Latin America, behind Brazil, and a leader in the manufacture of biodiesel.

"We took the initiative years ago and became a pioneer," Jorge Cardenas, president of the Colombian Biofuels Federation, said in an interview.

With just over 100 million gallons annually, Colombian ethanol production is dwarfed by the billions of gallons churned out yearly in the U.S. and Brazil.

Yet Colombia is a technological leader in the field and is experimenting with biofuel production using everything from sugar beets and palm oil to yucca.

Colombian experts are helping companies in Guatemala, Honduras and El Salvador set up ethanol plants.

Farther north, Louisiana Green Fuels, which is partially owned by Colombian investors, plans to launch what could become the first sugar cane ethanol plant in the U.S., near Lake Charles.

The distillery, scheduled to open next year, will produce about 25 million gallons annually. Three more plants are to be built by 2012.

"The Colombian work ethic, engineering and appreciation for ethanol production have had a significant part to play in bringing this project to fruition," said Randal Johnson, a company spokesman.

Colombia is also the hemisphere's largest producer of palm oil.

Tons of oil are turned into biodiesel, which elsewhere is made from rapeseed oil.

Biodiesel production will more than double this year to 218 million gallons, Jens Mesa Dishington of the Federation of Oil Palm Producers said in Bogotá, the capital.

The world's sudden thirst for biofuels came at precisely the right moment for Colombia's sugar growers.

Not only did world prices for the sweetener drop from nearly 15 cents to 10 cents a pound last year, but the weakening dollar meant less income for sugar exporters.

In 2007, their profits plummeted by 44 percent, according to the Colombian Sugar Cane Growers Association.

These days, however, mills are shifting much of the cane from sugar to ethanol production, which is far more profitable.

More used for ethanol
At the Providencia Sugar Mill, which is the size of several football fields, massive machines wash and shred cane stalks then press out the juices. These liquids are crystallized into sugar or fermented and distilled into ethanol.

"We started out using 18 percent of the cane for ethanol, but in some months the figure has gone up to 40 percent," said Marucio Tello, who helps run the ethanol distillery at the Providencia mill, 15 miles northeast of Cali.

Colombia was once the world's sixth-largest sugar exporter, but overseas sales have dropped by half since 2003. Meanwhile, five modern distilleries now produce enough to make the nation nearly self-sufficient in ethanol.

The transition has helped the sugar industry avoid job cuts and mill closures.

Nearly the entire crop is harvested by about 15,000 workers, most of whom wear metal gloves and shinguards to keep from gashing themselves as they slice down the fields with their thick-bladed machetes.

"Biofuels have given us some breathing room," said Alvaro Amaya, director of the Center for the Investigation of Sugar Cane.

Although neighboring Brazil has been producing huge quantities of ethanol since the 1970s, Colombia began to seriously consider biofuels in 2001 as oil reserves dwindled. Analysts predicted the country would need to start importing petroleum by 2012, and ethanol and biodiesel seemed like attractive alternatives.

Huge potential
Unlike in the United States and Europe, where most of the fertile acres are already under cultivation, Colombia still has vast tracts that could be turned into farmland to produce biomass without disrupting the national food chain.

"The agricultural frontier could be expanded enormously," President Alvaro Uribe told a recent gathering of farmers. "There is land for everything: to increase food production and to increase biofuel production."

Colombia already grows half a million acres of sugar cane, which is far more efficient than corn or other crops for producing ethanol.

Newly developed strains of the plant helped Colombian farmers reduce the growing cycle from 17 to 12 months and extract 6 tons of sugar per acre, the highest sugar production rate in the world.

The key incentive came when the government mandated that the national gasoline supply must contain 10 percent ethanol by the end of 2009, a figure that will increase to 25 percent by 2025.

Meanwhile, palm groves first planted to produce edible oils have been expanded to supply newly built biodiesel plants. A new law mandates that the country's diesel must contain at least 5 percent biodiesel by year's end.

"The oil was running out. That was the determining factor," said Cardenas, of the Biofuels Federation. "If there had been enough oil, we wouldn't have had the political will to do this. But with oil at more than $100 a barrel and reserves falling, people began to get worried."

Getting into biofuels production "was like striking an oil deposit equal to 10 percent of the country's supply," added Johan Martinez of the Sugar Cane Growers Association in Cali.

The Uribe government wants to expand the sugar cane crop from 500,000 acres to 2.5 million acres to feed more than a dozen ethanol distilleries expected to come into produc-
tion within the next five years.

Eventually, the plan is to export ethanol to the United States. Unlike Brazilian ethanol, which faces a 54-cent-per-gallon import tariff, Colombian ethanol could enter the American market duty-free under the terms of trade agreement between the two nations that has yet to be approved by the U.S.
Congress.

Taking over
Not everyone is thrilled with the expansion plans.

At a recent meeting of regional leaders in Mexico, Nicaraguan President Daniel Ortega complained of rising food prices in poor nations and criticized Uribe for encouraging Central American countries to grow more sugar cane for ethanol than food crops.

"For Nicaragua, it's a mortal sin to talk about biofuels," Ortega said.

There have also been widespread reports from northern Colombia about peasant farmers who returned after being driven away by death squads to find their fields occupied by industrial-scale oil palm producers.

Yet at the same time, industry backers are promoting biofuels as a way to generate more jobs in the impoverished countryside, where many down-and-out farmers plant coca, the raw material for cocaine.

U.N. statistics showed that the coca crop in Colombia, the world's largest producer of cocaine, had expanded by 27 percent last year to 245,000 acres.

Speaking at a recent biofuels conference, Agriculture Minister Andres Felipe Arias said: "Peasants who grow
palm trees are not going to fall into the temptation to grow coca."

john.otis at chron.com

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cousin_it wrote:
kinds makes us look stupid converting food into fuel

the corn based ethanol debacle was a back room deal between ADM lobbyists and members of congress - neither of which have the US citizens's best interests at heart
7/6/2008 7:19:42 AM
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FD HIDDEN DIV

By mariacvetanoski on Jul 6, 2008, 06:59 in Friendly Talkzone.

RogueOne says on Jul 6, 2008, 07:30:

Hmmm! Lots of good information on biofuels in that article, positive stuff for Colombia.
I was also reading elsewhere (http://www.bernama.com.my/bernama/v3/news_business.php?id=157856) of the value in Palm Oil instead of rapeseed (aka canola) oil.
Thanks

0 funny, 0 helpful.