The World Biofuels 2010 conference will kick off in Seville, Spain, tomorrow and Bob Dinneen, President and CEO of the Renewable Fuels Association, will address world leaders. In anticipated remarks, Dinneen will challenge the claims that American ethanol production can’t cost compete with other producers such as Brazil. In addition, Dinneen will address misperceptions about indirect land use.
“Despite claims from other ethanol producers, America is the world’s low cost producer of ethanol today,” said Dinneen. “Advancements in ethanol production technologies together with the unprecedented productivity of American farmers allow American ethanol producers to cost-effectively supply domestic markets and increasingly those around the world.”
With consumer sensitivity to prices at the pump heightened with recent events, it is interesting to note that ethanol has sold as a discount to gasoline by as much as 80 cents per gallon wholesale before any tax incentives were incorporated. The price coupled with incentives should have saved consumers 12 cents per gallon on E10. According to RFA, by comparison, if the gasoline were blended with Brazilian ethanol, the price would be 11 cents higher per gallon.
Dinneen will also address the growing presence of American ethanol producers in the world markets with 2010 expected to break all records for fuel ethanol exports.
“The emergence of U.S. exports of ethanol to markets once dominated by Brazil demonstrates that a true global market for ethanol is developing.” said Dinneen. “As the low cost producer of ethanol today, America is enjoying the same opportunities that many thought were solely the province of Brazil. Such competition in the world market undermines the continued claims that U.S. and other nations’ ethanol import policies are barriers to trade. Rather, inconsistent policies that vacillate based on the fortunes of domestic ethanol producers introduce the kind of uncertainty that world trade abhors. As the market is clearly showing, consistent policies across the globe will reward the low-cost producer. “