Commodities

Flouting Amazon-fire outrage, Brazil allows for sugar expansion

Bloomberg November 7 | Updated on November 07, 2019

The task force in action to put out a fire in the Amazon rainforest in Porto Velho, Rondonia state, Brazil, (file photo)   -  Bloomberg

President Jair Bolsonaro scraps decade-old regulation on cane areas

Brazil has faced international outrage over fires in the Amazon. Rather than shrinking from the scrutiny, President Jair Bolsonaro decided to make yet another controversial move by allowing for the expansion of sugar farming in the planet’s biggest rainforest.

Bolsonaro annulled a 10-year-old regulation that had banned the expansion of sugar-cane planted in the Amazon and a wetland savanna called as Pantanal and indigenous and reforested areas, according to a resolution published in the country’s official gazette.

The move comes after backlash over the Amazon fires started flaring in August. Bolsonaro has dismissed the fires after pledges of slashing deforestation restrictions, and Donald Trump has tweeted his support for the leader. Meanwhile, Brazilian agricultural groups have warned that major importers could start snubbing purchases from the commodity powerhouse because of environmental concerns.

The scrapped sugar regulation had helped Brazilian ethanol, mostly made from cane, to be globally recognised as a fuel with high sustainability standards. The South American nation is the world’s top sugar producer and exporter and is a major player in the biofuels space.

Gobal leaders, environmental groups and consumers expressed sharp criticism over Bolsonaro’s tactics as the Amazon burned. This year through November 5, 77,239 fires were detected in the rainforest, home to 10% of all known plant and animal species. That was up 31 per cent from a year ago, according to data from the National Institute of Space Research, known as INPE. Still, the pace of new blazes has slowed from a peak in August.

For Brazilian ethanol and sugar producers, the old rules played an important role when it came to sustainable expansion, according to Evandro Gussi, head of the major sugar industry group Unica.

Still, many cane mills have made even higher environmental commitments than the ones outlined in the regulation created ten years ago. Meanwhile, the country’s new federal renewable-fuel program, RenovaBio, will take effect in January and requires zero deforestation from its participants.

“The ones who practice deforestation will be out of RenovaBio, because ethanol and all sugar-cane products must be sustainable from the beginning to the end,” Gussi said in a statement on Unica’s website. “We have moved from the age of regulation to the compromise.”

Published on November 07, 2019

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