In what looks to be straight out of Dow (DOW)Chemical CEO Andrew Liveris's playbook, John Rice, VP of the Archer Daniels Midland Company (ADM)said "Investment in research, infrastructure, and transportation, and partnerships between ethanol producer countries are the measures required in order to ensure the future of renewable fuels." He said this at the panel Global Paradigms: The experience of ethanol in the United States and in Brazil, on June 4th at the Ethanol Summit 2007, São Paulo, Brazil.
The president of the São Paulo Sugar Cane Agroindustry Union (Unica), Eduardo Pereira de Carvalho, also believes a partnership between ethanol producer countries to be the best strategy for the success of renewable fuels. "Maize ethanol produced in the United States does not compete with our ethanol. My 'enemy' is gasoline," Carvalho joked.
He continued, "What we need to do is make the forecast investment of US$ 17 billion in the production sector come true, qualify ethanol as an energy product in order to overcome barriers to agricultural products, and sign long term agreements," he said.
ADM is currently the world's largest producer of biodiesel and of corn ethanol and has stated it is looking for investment for ethanol in Brazil and will begin producing biodiesel there this month. This is exactly what Dow did recently in Saudi Arabia with it's petrochemical announcement last month. If you are a producer a product, produce it where the input costs are the cheapest. Since the Brazilian ethanol program is quazi state run, also like Dow's situation again, ADM will be going into business with the gov't.
Brazil wants US investment in it's ethanol program, ADM wants to produce cheap ethanol, this is going to happen....