Alana Gandra
Reporter Agência Brasil

Rio - Petrobras, Brazil's state-run oil giant, reports it is studying the possibility of exporting sugarcane-based ethanol to Japan. A joint venture company, Brazil-Japan Ethanol, would be set up.

"Japan could import from 1.8 billion liters to 6 billion liters of ethanol, depending on the amount it adds to its gasoline, which would be between 3% and 10%. However, this is all something for the future. It will not happen before 2008," says Paulo Roberto Costa, director of Supply at Petrobras, who adds that at the moment the priority for Petrobras is the domestic Brazilian market. Costa explains that ethanol exports on the scale that Japan needs would require an increase of around 40% in ethanol production in Brazil.

"We have to ensure that we have buyers in Japan and adequate production in Brazil," declared Costa, making it clear that Petrobras is not and will not be involved in the production of sugarcane- based ethanol (in the case of ethanol, Petrobras is a distributor). However, he added that a deal with Japan would certainly be good for both the industrial and farm sectors in Brazil.

Costa revealed that in 2005 Petrobras exported 50 million liters of ethanol to Venezuela as part of a long-term deal to substitute lead in gasoline for less polluting ethanol in that country.

In 2004, total exports of ethanol by Brazil reached 2.5 billion liters.

Translation: Allen Bennett