Brazil said to plan higher ethanol blend as early as May

Mario Segio Lima – Bloomberg, 12/18/2012

Brazil, the world’s biggest sugar- cane grower, is considering raising the amount of ethanol mixed with gasoline as early as May as millers are forecast to process a record crop next year, a government official familiar with the plan said.

The mandatory ethanol blend in fuel sold at Brazilian service stations would rise to 25 percent from 20 percent now, said the official, who asked not to be named because he’s not authorized to discuss the plan publicly. Mills in the country process most of the sugar-cane crop into sweetener and fuel between April and November.

Petroleo Brasileiro SA (PETR4), Brazil’s state-run oil producer, has been importing gasoline and selling it below cost this year after fuel demand in the world’s second-largest emerging economy exceeded domestic supplies. Brazil lowered the ethanol blend to 20 percent from 25 percent in October 2011 after rainfall delayed sugar-cane harvesting and reduced crop yields.

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