Brazil Ups Mandatory Biodiesel Blend to 5% in 2010

Effective January 2010, Brazilian diesel fuel vehicles will be required to run on a 5 percent biodiesel blend, up from 4 percent at present. The announcement was made last Friday by president Luiz Inácio Lula da Silva and is expected to raise biodiesel production levels to 2.4 billion liters (634 million gallons) in 2010.

Biodiesel blends became mandatory in early 2008, followed by a raise in blend levels from 2 to 3 percent in July of the same year and from 3 to 4 percent in 2009. The increase to 5 percent was originally planned for 2013.

This has enabled a steady expansion of the Brazilian biodiesel market, with 43 plants operating today and production capacity currently at 3.6 billion liters (950 million gallons) per year, more than enough to supply the volume required by the 5 percent mandate.

”Our urban areas and highways will have cleaner fuel, which also creates jobs and generates income to the poor through family farming”, said minister of Mines and Energy Edison Lobão. More than 90 percent of the market has received the Social Fuel Label, a mechanism used by the federal government to ensure a joint participation by small farmers and agribusinesses in the biodiesel production chain.