Brasília, September 1, 2003 (Agência Brasil - ABr) - The government is holding discussions with the private sector on a program to produce alcohol, Pro-Cane, to supply markets in countries like Japan, interested in importing the product from Brazil.

When he released this information, the Minister of Agriculture, Livestock, and Supply, Roberto Rodrigues, said that "it will be a new model of sugarcane production for sugar and alcohol, to provide sustainability to the sector's productive chain."

There is already a project under study, with financial backing from the Japanese International Cooperation Bank and the Brazilian private sector. In the initial stage, the Japonese could import up to 1.8 billion liters of fuel alcohol. But, according to the Minister, this requires investments in order to avoid harming sugar production.

The Minister said that the 1.8 billion liters of fuel alcohol that the Japanese intend to mix with their gasoline, as a form of reducing carbon gas emissions in the atmosphere, represent 15% of Brazil's production. "Brazil has an installed capacity to produce 16 billion liters and produces slightly over 13 billion," he informed.

According to Rodrigues, the distilleries are already in place and could easily meet Japanese demands. "The problem is that we would have to divert sugarcane for alcohol production. This means producing less sugar, and this could result in a loss in exports, a prospect that is not very attractive to producers."

At a meeting, Friday (29), with Japanese Senators, Junitchi Fukumoto and Tsutomu Yamazaki, who came to Brazil to acquaint themselves with the national fuel alcohol production process, the Minister suggested that Japan invest more in sugarcane production in regions that are not traditional production centers. "Brazil has an area of around 5.5 million hectares that would would be very easy to expand to supply the Japanese demand. A hectare of sugarcane produces seven thousand liters of alcohol. With a little over 250 thousand hectares, we could meet Japan's needs."

The Minister suggested that, in addition to the joint endeavor, a Brazilian delegation travel to Japan to explain the benefits of alcohol, especially for the environment. "Besides being a less polluting product, sugarcane also removes carbon dioxide from the atmosphere. Japan would be investing on both fronts."

The Japanese Senators promised to study the matter, but they declared in advance that they can make a securitized investment. "They would provide financing, with guarantees of receiving the product, a long-term supply, and pre-determined prices and costs." (DAS)