Brasília, June 1, 2004 (Agência Brasil) - The Minister of Agriculture, Roberto Rodrigues, disclosed that the Japonese government confirmed its interest in making US$ 300 million available to finance research in the area of biofuels (ethanol and biodiesel) in Brazil. According to the Minister, a Japanese team of experts will be coming to Brazil in the coming months to work out the details of the project.

At the beginning of the year, Brazil presented Japan with a project to finance research in the area of biofuels. According to Rodrigues, the value of the project, originally budgeted at US$ 300 million, may be augmented, depending upon the negotiations. The Brazilian sugar and alcohol sector is interested in supplying ethanol and biodiesel to the Japanese.

Rodrigues recalled that, in March, Japan authorized the addition of 3% of alcohol to gasoline. The Minister calculates that this can represent an annual demand for 10 billion liters of alcohol by the Japanese market.

To meet this demand, Brazil would have to plant an additional 2 million hectares of sugarcane. "But we must also discuss with Japan the question of price and the logistics of transporting and warehousing the product."

The Minister informed that he proposed the creation of a Brazil-Japan free trade area. Rodrigues is in Tokyo and gave a collective interview yesterday (31) by telephone.

Reporter: Kelly Oliveira
Translator: David Silberstein