Aug 05, 2021

Increases in Biodiesel Opposed by Brazilian Petroleum Institute

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The Brazilian Petroleum Institute (IBP), which represents petroleum producers in Brazil and others, has petitioned the Brazilian government to return to a 10% blend (B10) of vegetable oil in the nation's biodiesel. They claim that blends higher than 10% causes problems for equipment and motors. The Brazilian Association of Biofuel Producers (Aprobio) contend that IBP provided no evidence, data, or studies that supported their claim.

At the start of 2021, the blend of vegetable oils in Brazilian biodiesel was 13% (B13). The government lowered the percentage to 10% (B10) in the middle of the year citing the high cost of soybean oil which is the main vegetable oil used in biodiesel. Biodiesel producers contended that soybean oil made up only a small percent of the price of biodiesel and the real culprit was the higher cost of petroleum.

The blend percentage was increased to 12% (B12) for September and October, which was still below the 13% (B13) at the start of 2021. Petrobras can adjust the blend percentage every two months.

IBP contends that blends higher than 10% causes problems for consumers such as congealing of the diesel, engines stoppages, clogging of filters, and early deterioration of metal parts.

Aprobio countered that argument by pointing out that since the creation of the National Program for the Production and Use of Biodiesel, there have been ample studies and tests conducted by the Ministry of Science and Technology and the Ministry of Mines and Energy indicating that the biodiesel on the market is if the highest quality.

Aprobio also contends that no harm to equipment or motors has proven to be the direct result of the use of biodiesel in mixtures approved by equipment and engine and manufactures and by the Ministry of Mines and Energy.

This tug-of-war between petroleum producers and biodiesel producers is probably more about market share than anything else. Petroleum producers do not want to continually give up market share to biodiesel producers.

In addition to IBP, signers to the petition included the Brazilian Association of Fuel Importers (Abicom), the National Association of Fuel and Lubricant Marketers (Fecombustivies), the National Association of Vehicle Manufactures (Anfavea), the National Association of Vehicle Distributors (Fenabrave), the National Transport Confederation, and others.