PAISS Program to Help Brazilian Sugarcane Industry

Sugarcane_harvesting_equipment_Piracicaba_  Mariordo Mario Roberto Duran OrtizThe National Bank for Economic and Social Development (BNDES) and the Funding of Innovation and Research (FINEP) have announced a new program to encourage agricultural innovation for the Brazilian sugarcane industry. The goal of PAISS is to spur innovation and research that achieves gains in increasing productivity while lowering production costs. The PAISS complements the similar plan launched by BNDES and FINEP in 2011.

Enabling investments in agricultural innovation contributes to a renewal of the gains in productivity and to reductions in production costs. “It’s a step that can help us reach a new virtuous circle of investment to expand the production capacity of the sugarcane industry,” said Elizabeth Farina, the president of the Brazilian Sugarcane Industry Association (UNICA).

Farina noted that 60 percent of the production costs of ethanol and sugar lies in agricultural production. “The agricultural costs are already high and are in the ascendant, unlike the costs of industrial processing of sugarcane, which has been the subject of research and investment that has resulted in lower costs,” Farina explained.

UNICA data show that during the boom years of the sugarcane industry, between 2002 and 2010, the cost of agricultural production amounted to U.S. $15 per tonne while today this cost has doubled to nearly U.S. $30 per tonne.

Farina noted that the industry has adopted new and advanced technologies with unique speed, as observed in the process of mechanization of the harvest. This is leading to the elimination of burning the cane fields. “But the fact is that in the effort to mechanize the industry literally changed processes without research by adapting existing technology used for manually harvesting sugarcane. Over five years, the industry has adapted to the sugarcane machines, not the machines to sugarcane. It will probably take another five years to find better answers,” added Farina.

Amyris Increases Biodiesel Buses in Brazil

Amyris, Inc. has announced that the city of São Paulo is now operating 400 city buses using Amyris Renewable Diesel, which is branded locally as Diesel de Cana. In other news, Amyris announced it has successfully produced its first fragrance oil for its partner Firmenich SA.

“From fuels to consumer care products, we continue to make progress on our commercialization of No Compromise renewable products that meet our customers’ needs,” said John Melo, President & CEO at Amyris. “We are not only building on our Biodiesel Bus in Brazilexisting fuels market opportunities but also expanding our portfolio of renewable products, as we have shown with our successful production of a fragrance oil, the third molecule we have taken from lab to industrial scale following artemisinin and farnesene.”

The announcement regarding the expanded use of Diesel de Cana took place with the São Paulo Public Transportation Authority (SPTrans) and its industry partners. The diesel blend is produced from locally-grown sugarcane using Amryis fermentation technology. In addition a trial will begin in 2014 to pilot the use of 100 percent Amyris Renewable Diesel in several city buses.

“We are pleased to increase our supply of Diesel de Cana in São Paulo, helping bring the city closer to its goal of 100% renewable fuels in public transport while reducing air pollution,” said Adilson Liebsch, commercial director at Amyris Brasil. “Our drop-in renewable fuel has been used commercially at blends of 10-30% for two years and logged over 30 million kilometers to date. Working with Mercedes-Benz, MAN and Volvo on a 100% Diesel de Cana trial, we will build greater confidence in our fuel’s quality and performance, paving the way to expand our commercial efforts in other metropolitan areas globally.”

The city of São Paulo has more than 15,000 buses consuming about 450 million liters (118 million gallons) of diesel per year. Amyris’s sugarcane-based diesel is helping the city meet its goal of reducing fossil fuel use in the public transit system. Under city law, São Paulo is working to reduce fossil diesel use by 10 percent every year through 2018.

Ethanol – The Complete Fuel Wins Awards

The Union of the Industry of Cane Sugar Association’s (UNICA) “Ethanol – The Complete Fuel” has won four awards including the Sponsor of the Year for 2013 during the 17th Annual Brazilian Association Rural Marketing and Agribusiness. The country-wide campaign was designed to educate consumers about the benefits of ethanol. The association has also called upon the government to assist with this educational campaign.

We want to recognize the effort made ​​by the entire sugarcane industry, who made this campaign a reality and achieved significant results. The campaign was spearheaded by UNICA with strong engagement with its affiliates, but had important additional support from several plants that are not our affiliates and entities that helped expand the reach of the campaign said UNICA President Elizabeth Farina. Three associations – the Alcopar, Paraná; the Sifaeg; and Siamig Goiás, Minas Gerais – invested its own funds in the campaign and rolled it out in their respective states.

In addition to receiving the award for the UNICA Advertiser of the Year for 2013 in agribusiness, Farina delivered a special tribute for ABMR & A to honor former Agriculture Minister Roberto Rodrigues. He was recognized for his leading role in building the movement Am Agro, which among other elements, conducted an advertising campaign in 2011 in favor of agribusiness, which had as protagonists actors Lima Duarte and Giovanna Antonelli. UNICA was the main supporter of the Movement am Agro.

The Borghi/Low , the agency that developed the campaign “Ethanol, Complete Fuel,” also received several achievements during the awards, including the Agency of the Year in agribusiness in 2013, for their work on behalf of UNICA and the Box Economica Federal, another client of the agency.

We want to give our appreciation for the efforts of all UNICA professionals, Borghi/Lowe and other service providers, which directly contributed to the success of the campaign. It was an intense job that lasted over a year and is now getting due recognition added Farina. And we can not forget the excellent work of Lúcio Mauro Filho, who is a true ally of ethanol.

UNICA Asks Gov’t to Educate Country About Ethanol

UNICABrazil’s sugar cane growers are asking for some help from that country’s government to educate the public about ethanol. Elizabeth Farina, the President of the Union of the Industry of Cane Sugar Association (UNICA), said the industry needs to overcome prejudices caused by inadequate public policies and interference in the fuel market that hurts ethanol’s competitiveness. To that end, the Parliamentary Front for the Enhancement of the Sugarcane Industry, was officially launched in the capitol city of Brasilia.

“It is very important that society knows that even with negative results in recent years and at the expense of a growing indebtedness and dangerous for the industry, companies have invested heavily in technology to improve performance, increase production and improve sustainability. Unfortunately, the good results on the production side are not translating into financial returns. The nominal average price paid by the ethanol plant is decreasing in the last three years, while the costs of structural and cyclical production has grown relentlessly,” says Farina.

Just last year, more than $4 billion was spent on sugarcane plantation renovations and expansions in Brazil’s South Central region, representing a significant investment in that area’s economy, in addition to the money spent on infrastructure to help the biofuels industry.

“All this does not take into account the increasing resources dedicated to the development of cellulosic ethanol or second generation. It is no coincidence that our companies today get between 7 and 8 thousand liters of ethanol per hectare, while the production of ethanol from corn in the United States, does not exceed 4000 liters per hectare,” stressed the president of UNICA.

UNICA also points out that Brazilian ethanol is recognized by the Environmental Protection Agency (EPA) as an advanced biofuel.

Amyris Partners With GOL

Bioenergy company Amyris, Inc. and GOL Linhas Aéreas Inteligentes S.A. (GOL) the largest low-cost and low-fare airline in Latin America, have announced the signing of a memorandum of understanding (MOU) that will pave the way for GOL commercial flights to use Amyris renewable jet fuel in 2014. The partnership was announced during the first commercial flight with a renewable jet fuel in Brazil by the airline.

“GOL is committed to making commercial aviation more efficient and sustainable. Our GOL airplaneexperimental flight with renewable jet fuel at the Rio+20 in 2012 was an important step to guide our work. Today, we advance one more step,” said Adalberto Bogsan, Vice President of GOL.

Under the MOU, GOL and Amyris will work together to establish a framework for bringing Amyris renewable jet fuel produced from Brazilian sugarcane to GOL’s commercial flights. However, for thid to happen, regulatory approvals and validation by standard-setting bodies, including ASTM International and Brazil’s Oil, Gas and Biofuels Agency (ANP) will need to occur.

The partnership, under of auspices of the Brazilian Biofuels Platform, an industry and government-supported initiative to encourage the use of renewable fuels in aviation, was announced at Brazilian Aviation Day celebration, which included participation of Brazil’s Secretary of Civil Aviation, Minister Moreira Franco, and a number of industry stakeholders including Brazilian Airlines Association (ABEAR), Brazilian Biodiesel and Biojet Association (UBRABIO), GE, and Boeing among others.

“GOL supports all initiatives to help make Brazilian aviation more sustainable,” says Paulo Kakinoff, President of GOL. During this past year, the airline’s fuel saving initiatives have helped it to reduce greenhouse gas emissions by over 30 thousand tons.

Lifecycle analysis indicates that the Amyris renewable jet fuel could reduce greenhouse gas emissions by 80% or more when compared to convention fossil-derived jet fuel. Amyris has applied for certification under the Roundtable of Sustainable Biomaterials (RSB) and is a member of Bonsucro, the world’s leading sugarcane sustainability standard.

“We are committed to working with the aviation industry to bring cleaner skies, starting in Brazil in 2014. Following two successful demonstration flights and a series of successful tests with multiple industry stakeholders, we look forward to receiving ASTM validation and ANP approval of our breakthrough renewable jet fuel produced from Brazilian sugarcane,” said John Melo, Amyris’s President & CEO.

Call for Brazil to Reinstate Fuel Tax Policy

The Brazilian Industry Sugarcane Association (UNICA) is calling for the return of the ICMS tax policy that creates incentives to use ethanol over gasoline. When the tax policy is in place, funds generated from the fuel tax are used to subsidize public transportation. UNICA notes that the policy is a way to generate positive economic, social, environmental and public health benefits. The Association’s recommendation came on the heels of a study conducted by the Fundação Getúlio Vargas (FGV) on behalf of UNICA.

“We insisted that the recognition of so-called positive externalities of ethanol, through public policy and differentiated taxation, would be an important step towards returning to the competitiveness clean and renewable fuel to the base of cane sugar. The FGV study sugarcaneshows that it is possible to start down this path, with important benefits for society,” said Elizabeth Farina, the president of UNICA.

Until 2007, fossil fuels (gas) were taxed more heavily than renewable fuels (ethanol). Farina notes that reinstating this tax structure would also have significant environmental impacts, something that has not been considered as part of the benefits of the tax policy.

“We often hear very naturally that the calculation to be done in time to fuel the car is 70 percent, i.e. ethanol should not cost more than 70 percent of the price of gasoline. Except that this calculation does not take into account the severe environmental damage caused by the increase in the use of gasoline and reduction in the use of ethanol, especially in large cities,” said Farina.

A recent study released by the Health and Sustainability Institute points out that 4,655 people died due to poor air quality in the state capital in 2011 – a total more than three times the number of deaths in traffic accidents. Farina says that the damage goes beyond environmental issues. Currencies are wasted to import gasoline, as demand could be being fueled by ethanol, a industry employing more than a million Brazilians and benefits over a thousand municipalities throughout the country. Continue reading

Novozymes & Raízen Partner on Cellulosic Ethanol

Novozymes and Raízen Energia S/A, Brazil’s largest sugarcane crusher, have announced plans to collaborate on the first commercial-scale cellulosic ethanol plant in Brazil. Novozymes will be supplying enzyme technology for the plant, expected to begin production by the end of 2014.

Sugarcane in BrazilThe plant will be a bolt-on facility to Raízen’s Costa Pinto sugarcane mill in the state of São Paulo and will have the capacity to produce 40 million liters of cellulosic ethanol a year from sugarcane bagasse and straw. The agreement also provides for Novozymes to supply enzyme technology to Raízen’s second cellulosic ethanol plant, should such a plant be constructed.

To support Raízen in its efforts to advance cellulosic ethanol, Novozymes will develop enzyme technology optimized for Raízen’s process. In addition, Novozymes intends to establish new enzyme-manufacturing capacity in Brazil. The exact size, location and investment budget for this enzyme-manufacturing facility are not yet determined and will depend on the level of estimated demand for enzyme technology in Brazil.

“This first plant developed by one of the world’s largest sugarcane ethanol producers marks an important step in the commercialization of cellulosic ethanol in Brazil,” said Thomas Videbæk, Novozymes’ Executive Vice President of Business Development. “We look forward to sharing the journey with Raízen and enabling this exciting development for Brazil through the delivery of world-leading enzyme technology.”

Brazil Sugarcane Harvest Strong

Brazilian sugarcane harvestThe volume of cane sugar produced by mills in the South-Central region of Brazil reached 46.34 million tons in the first 15 days of August, up 4.72 percent compared to value recorded in the same half of the previous year (44.25 million tons). Since the harvest began, crushing has totaled 315.10 million tons, an increase of 20.68 percent compared to the same period in 2012. However, this amount remains below the 338.08 million tons recorded in the same period of 2010/2011 season – at which plants located in the Center-South processed 556.95 million tons at the end of that season.

According to the Technical Director of the Union of Industry Cana-de-Açúcar (UNICA), Antonio de Padua Rodrigues, “The number of days lost in this first half of August was very low, a fact that allowed the production units operating near capacity production of this crop.”

In relation to agricultural productivity, according to data compiled by the Center for Sugarcane Technology (CTC), this totaled 86.50 tons of cane sugar per hectare in the first half of August. Of the total amount of cane sugar ground in the first half of August, 47.76 percent has been allocated to the production of sugar.

“The recent change in the exchange rate promoted a recovery in sugar prices in reais and changed the attractiveness of the product compared to ethanol,” said Rodrigues who noted this has not caused a drastic change in product mix in favor of sugar. “This is because the flexibility of production facilities is limited in this harvest period characterized by more grinding and ATR, ie, when industries work closely with its manufacturing capacity,”

Ethanol production reached 1.95 billion liters in the first 15 days of August, with 1.10 billion liters of hydrous and 858.23 million liters of anhydrous ethanol. The manufacture of sugar, in turn, totaled 2.91 million tonnes against 3.03 million tonnes registered in the same half of 2012. Continue reading

Why Sugarcane Ethanol is Essential to RFS

There is a significant amount of attention being paid to the Renewable Fuel Standard (RFS) but one area that hasn’t been talked about much is the role of sugarcane ethanol in the RFS. To learn more, I spoke with Leticia Phillips the representative for North America with UNICA – the Brazilian Sugarcane Industry Association.

She said that under the RFS, Brazilian sugarcane ethanol is classified as an “other advanced biofuel” and by 2022 this category of fuel is to contribute 4 billions gallons to the fuel supply. Phillips said that today, sugarcane Leticia Phillipsethanol is the best performing biofuel commercially available today. According to Environmental Protection Agency (EPA) calculations, sugarcane ethanol reduces greenhouse gas emissions (GHG) by at least 61 percent when compared to traditional fuel, i.e. gasoline.

Today, sugarcane ethanol represents 3 percent of all fuels under the RFS, but it is actually one quarter of the advanced pool of the fuels for the RFS. Phillips says it plays a pretty important role and provides a secure flow of biofuels.

Brazilian sugarcane ethanol has been under fire because its not “American-made” and also because many argue it doesn’t have the GHG emission reductions that the EPA says it does. I asked Leticia why UNICA believes push-back on the biofuel is misplaced.

Leticia said from her viewpoint is that the RFS doesn’t specify that the fuel must be made in America, but rather the goal is to reduce carbon emissions. “The goal should also be to help America become energy secure and energy diverse,” explained Phillips. She said that energy security and energy independence both mean looking at where the country can get better performing biofuels for the program.

While she understands some of the push-back from the market, she stressed that a bigger problem with the RFS today is the so-called “blend wall” issue coupled with the fact that American fuel use is dwindling – a scenario no one anticipated when the RFS was created.

To learn more, listen to my interview with Leticia Phillips here: Why Sugarcane Ethanol is Essential to the RFS

For more information on sugarcane ethanol, visit UNICA’s sugarcane website.

Brazilian Biofuel Trade Mission

A first-of-its-kind joint trade mission to Brazil has been scheduled to “improve and enhance biofuels trade by matching businesses seeking greater trade opportunities in ethanol and other biofuels as well as green technology designed to expand and enhance biofuel production.”

brazilApproximately 15 companies will be selected for the mission, which is the product of a partnership between the Renewable Fuels Association (RFA), Brazilian Sugarcane Industry Association (UNICA), and the Advanced Biofuel Association (ABFA), targeting the Brazilian cities of São Paulo and Recife.

The trade mission, which will be held Sept. 30 to Oct. 2, will focus on introducing importers and exporters of biofuel and biofuel technology, in an effort to enhance bilateral relationships and enhance trade opportunities. The effort was engineered through a partnership between the aforementioned biofuel advocates, and the Brazil-U.S. Business Council (BUSBC), which represents key businesses from the United States and Brazil that have interests in promoting free trade between the two countries. The BUSBC, which is a part of the U.S. Chamber of Commerce, is helping to administer the matchmaking mission as part of its Export Green Initiative, which was created through funding from the International Trade Administration of the U.S. Department of Commerce to promote U.S. exports of renewable and green commodities and technologies.

Learn more about the mission here.

RFA Initiates Talks with Brazilian Ethanol Industry

ed-brazilRepresentatives of the Renewable Fuels Association (RFA) recently took part in UNICA’s Worldwide Ethanol Summit in Brazil with a two-fold mission. First, RFA represented American ethanol interests at the global event, but it also offered them an opportunity to sit down with their Brazilian ethanol counterparts and discuss how they can work together in a growing international marketplace.

“It was kind of the first step in trying to forge an era of collaboration on issues important to our industry,” said RFA General Counsel Ed Hubbard, noting that it would be in the best interest of the two largest ethanol producing nations to provide supply assurances to other countries considering the increased use of biofuels. “Countries like China, India, and the Philippines and Nigeria that are looking at establishing 5-10% blend mandates.”

ethanol-report-adHubbard says they are being supported in the effort by several agencies of the federal government. “We went down there with the help and assistance of the U.S. Department of Agriculture, the Foreign Ag Service, as well as our friends at the Department of Commerce,” he said. “(The Brazilians) saw that there’s a commitment not only from industry but also from the U.S. government to try to help promote…our commodity around the globe.”

The next step will be more formal talks with Brazil and other countries to work toward a cooperative effort.

Find out more in this Ethanol Report with Hubbard: Ethanol Report on Talks with Brazil

Subscribe to “The Ethanol Report” with this link.

Brazil’s GranBio Open US Operations

Brazil-based GranBio has announced plans to expand to the U.S. with an office in San Francisco and has name Vonnie Estes as the managing director. In this new role, Ms. Estes will lead GranBio’s efforts to access new technologies and establish key public and private collaborations for the company’s continued global expansion in advanced biorefinery development.

Screen Shot 2013-04-26 at 10.13.42 AMMs. Estes joins GranBio from Codexis, a developer of engineered enzymes for pharmaceutical, biofuel and chemical production, where she most recently was Vice President of Corporate Development. Prior to Codexis, she was the Chief Commercial Officer at DuPont Danisco Cellulosic Ethanol (DDCE)as Executive Vice President, Business Development. Prior to joining DDCE, she led DuPont’s commercialization program for cellulosic ethanol. Her multifunctional team was responsible for the $140 million joint venture between DuPont and Danisco.

“GranBio intends to expand its profile in North America and our new office in the United States will allow us to build a team and execute our strategy,” said Alan Hiltner, Executive Vice President, GranBio. “We are extremely pleased that Ms. Estes will lead our effort. Her track record of success at large, established multi-national and early stage start-up companies is the mark of a true entrepreneurial spirit and savvy industry trendsetter. These are exactly the qualities we want to be known for as GranBio begins its strategic global expansion.”

In April, GranBio completed the acquisition of a 25 percent equity investment in the North American Cleantech pioneer American Process Inc. (API). Under the agreement, GranBio will have access to a proprietary biomass pretreatment platform that makes it possible to cost-effectively develop cellulosic sugars as a feedstock for conversion to a variety of biochemicals and biofuels.

Amyris Ships First Product

240617Amyris has shipped it first commercial product from its plant in Brazil. The facility was the company’s first purpose-built industrial fermentation facility and produces Biofene, the company’s brand of renewable farnesene, to be used in a range of specialty chemical and fuel applications.

“This initial shipment marks the successful completion of our start-up activities. We have operated multiple tanks without contamination or surprises through several production runs during the first month of operation,” said John Melo, President and CEO of Amyris.

“We are now focused on ramping up Biofene production and delivering product to our customers, from renewable diesel for bus fleets in Brazil to squalane emollient globally and soon a range of specialty chemical applications,” Melo concluded.

Amyris’s Biofene plant in Brotas, in the state of São Paulo, Brazil, sources its sugarcane feedstock locally from the Paraíso mill. Prior to the start-up of this facility, Amyris relied solely on contract manufacturing for commercial production.

Amyris Begins Biofene Production in Brazil

Amyris-logo (1)Amyris has announced that it has completed a $42.25 million private placement of its common stock. The company has also begun production of its industrial fermentation facility in Brazil and is producing Biofene, its brand of renewable farnesene, a fragrant oil chemical. When adding a hydrogen molecule to farnesene, you get farnesane, which is the foundation molecule for renewable diesel.

“We are encouraged by the continued, strong commitment from our major investors, particularly as we start up our new industrial fermentation facility for the production of our renewable hydrocarbons in Brazil,” said John Melo, Amyris President & CEO. “Our own farnesene plant at Paraiso has been successfully commissioned, with initial farnesene production underway. We anticipate sales from this facility during the first quarter of 2013.”

The Company sold 14,177,849 shares of common stock in a private placement to existing Amyris investors. The transaction included $37.25 million in cash proceeds and the conversion by Total Gas & Power USA, SAS of $5 million from an outstanding senior unsecured convertible promissory note.

Edeniq Expands Into Brazil

Edeniq, with its partner Usina Vale, a Brazilian sugar and ethanol producer, has begun to engineer and construct a bagasse to sugars demonstration-scale plant. The biorefinery will produce cellulosic sugars from sugarcane bagasse and then convert it into ethanol. The plant will handle up to 20 tons per day of bagasse and will be co-located at Usina Vale’s ethanol and sugar production site in São Paulo State, Brazil. One goal of the project is to demonstrate how sugarcane mills can economically increase ethanol production with Edeniq’s bolt-on technologies.

After a feasibility study was completed, Usina Vale signed a collaboration agreement with Edeniq under which they are jointly funding the bagasse to sugar demonstration-scale plant, believed to be the first of its kind in the region. Co-locating the demo plant at Usina Vale’s commercial site will accelerate the technology scale-up from demo to full-scale, and the technology will then be deployed at affiliated ethanol plants.

“Brazil has a large and growing demand for ethanol,” said Pedro Augusto Menezes de Toledo Florencio, CEO of Usina Vale. “We believe Edeniq’s technology will allow us to increase ethanol production in a very economical way, allowing us to meet the growing demand of our customers and our country.”

According to Edeniq, their technologies efficiently break down biomass to liberate cellulosic sugars that can be converted into ethanol and other products. Edeniq owns and operates a fully integrated two ton per day pilot plant in Visalia, California, in partnership with Logos Technologies, using its proprietary Cellunator, which mechanically pre-treats biomass so that it can be more easily converted to sugars, increasing sugar yield and thus driving an increase in ethanol yield. The Brazil plant will also include this technology.

“Through this partnership with Usina Vale, we are further demonstrating our model of increasing the efficiency, scalability and sustainability of biofuels through low capital and operating cost technologies that can be integrated directly into existing ethanol production sites,” added Brian Thome, President and CEO of Edeniq. “Edeniq is developing the lowest cost route to cellulosic sugars, which will lead to low cost ethanol production for our partners like Usina Vale.”