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Brazil biofuel lobbies push for reversal of blending decision to maintain the minimum biofuel content level in diesel at 10% for 2022

December 06/2021

MOSCOW (MRC) -- Brazil's powerful biofuel and farm lobbies are pushing the government to reverse a measure announced last week that maintained the minimum biofuel content level in diesel at 10% for all of 2022, reported Reuters.

"Lawmakers of the biodiesel caucus will act. As soon as the president learns of the repercussions of the measure, and he will certainly change his stance," Francisco Turra, board chairman of the Aprobio biofuels lobby, told Reuters in an interview on Wednesday.

A 10% mix represents a drop from the 13% requirement initially planned for 2021, and an even sharper fall from the 14% that was supposed to be adopted from March 2022, Turra said.

"There is a huge loss of the investments made and of jobs that would be generated," Turra said.

In September, Brazil's National Energy Policy Council cut the minimum biofuel content requirement to 10% from 13% previously, citing a rise in the price of soybeans, which represent some 75% of biodiesel content.

But lowering the biofuel mix in diesel is irrelevant to the its final price, the industry says.

As MRC informed previously, Brazilian President Jair Bolsonaro reiterated in late October, 2021, that he is considering the privatization of state-run oil company Petrobras, formally known as Petroleo Brasileiro SA, boosting its shares along with news of a fresh price hike in the domestic gasoline and diesel market.

We remind that in August 2021, Petrobras hired JPMorgan Chase & Co as an advisor to sell its stake in the petrochemical company Braskem SA.

We also remind that Braskem is no longer pursuing a petrochemical project, which would have included an ethane cracker, in West Virginia. And the company is seeking to sell the land that would have housed the cracker. The project, announced in 2013, had been on Braskem's back burner for several years.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in the first nine months of 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.
Author:Margaret Volkova
Tags:bioplastics, PP, PE, crude and gaz condensate, propylene, ethylene, petrochemistry, Braskem, Petrobras, Brazil, USA.
Category:General News
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