Latin America ramps up ethanol production

By Ryan C. Christiansen | July 08, 2009
Latin American countries are ramping up ethanol production despite the fact that many people in countries outside of Brazil are not aware of ethanol as a fuel.

In Central America, Guatemala is the number one producer of high-yield sugarcane and produces over 44 percent of Central America's sugarcane-based ethanol. According to Karla Tay, agricultural specialist for the USDA, five of Guatemala's 14 sugar mills produced approximately 64 MMgy of dehydrated ethanol from sugarcane in 2008, up from 42 MMgy in 2007 and 18 MMgy in 2006. Most of Guatemala's ethanol was exported to the U.S. and Europe. Production for 2009 is expected to be approximately 93 MMgy. Having eight of Central America's top 13 processing plants, Guatemala is expected to produce approximately 130 MMgy of ethanol by 2010. Guatemala's largest ethanol producer is Bio-Ethanol SA, which has a 13 MMgy plant and is expected to triple its capacity by the end of 2010. Meanwhile, ethanol producer La Union SA operates a 7 MMgy ethanol plant. Guatemala is the fourth-largest producer of sugarcane in all of Latin America with 530,000 planted acres and the potential for 870,000 acres.

In South America, Colombia, which began producing ethanol from sugarcane in 2005, is the world's second-largest sugarcane-ethanol producer with an approximate capacity of 64 MMgy from five plants in the Cauca River Valley in southwestern Colombia. According to Leonardo Pinzon, agricultural specialist for the USDA, Colombia has a mandate to use E10 by 2010 and current production can supply 85 percent of the requirement. In March, the Colombian government issued a decree that, beginning in 2012, all new vehicles sold in the country must be flexible fuel vehicles. Ethanol production dropped 6.1 percent in 2008 due to a sugarcane workers strike, but production is expected to increase to a record high in 2009. The government is sponsoring research and feasibility studies for new feedstocks for ethanol production, including sugar beets and yucca.

In Uruguay, new investments in ethanol production are expected to bear fruit in 2009, with approximately 1.5 MMgy of ethanol expected to be produced this year from molasses, sugarcane, and sweet sorghum, according to Ken Joseph, agricultural specialist for the USDA. Two additional projects, one backed by a French company and another by a U.S. company, are expected to be complete within five years to produce approximately 25 MMgy of ethanol each from sweet sorghum. Ethanol produced in Uruguay is expected to be exported to Brazil and Venezuela.

Meanwhile, according to a recent Gallup poll, citizens in only a handful of countries in the Caribbean and Latin America have heard of ethanol, and only 47 percent of all poll respondents in the region have heard of ethanol. In eight countries, including Brazil, Costa Rica, Nicaragua, Uruguay, Paraguay, Colombia, the Dominican Republic, and Panama, the majority of respondents have heard of ethanol; however, in Peru, Ecuador, Bolivia, and Mexico, less than 40 percent of poll respondents have heard of the fuel.