Guebert: Get ready for big ethanol imports under trade pacts June 26, 2005 http://www.pantagraph.com/stories/062605/bus_20050626002.shtml
The harder anyone scratches CAFTA, the Central American Free Trade Agreement pushed by the White House, the worse the smell in American agriculture gets. First, it was the creeping expansion of CAFTA sugar exports to the United States. Next, it was the time -- years, even decades -- before U.S. farmers received duty-free, total access to the tiny, poor Central American countries included in CAFTA. Now it's American agriculture's shiny, new star, ethanol, in CAFTA's gun sights. According to a June 22 report issued by the Institute of Agriculture and Trade Policy, CAFTA virtually guarantees a rising tide of duty-free ethanol exports from Caribbean and South American nations to the United States. A whiff of that plan arrived a year ago when Cargill Inc., the $63 billion agbiz elephant, announced plans to use a little-noticed clause in the Caribbean Basin Initiative (CBI) to ship sugar-based, Brazilian ethanol into El Salvador for dehydration, then export to the United States. Under the CBI, up to 7 percent of total annual U.S. ethanol production -- made from a "foreign feedstock, i.e. sugar from another, non-CBI country," notes the IATP report -- can be exported to the United States duty-free if it is produced in any of the 24 nations covered by the Caribbean Basin Initiative. Years ago that was a drop in the ethanol bucket. Now, however, with the ethanol market booming in the United States -- and Congress likely to mandate 8 billion gallons, or more than two times today's production, of ethanol use by 2012 --the bucket will overflow. Under the CBI, nearly 240 million gallons of Caribbean-sourced ethanol can enter the country tariff-free in 2005; 560 million gallons in 2012 if the pending energy bill includes the 8-billion-gallon mandate. Then, according to the IATP report, once that threshold is hit, the CBI allows "an additional 35 million gallons (to) be imported into the U.S. duty-free, provided that at least 30 percent of the ethanol is derived from 'local,' or Caribbean region, feedstocks." Yep, sugar. After those two targets are hit, more Caribbean ethanol can be imported. "Anything above the additional 35 million gallons is duty-free if at least 50 percent of the ethanol is derived from local feedstocks," the report explains. Gee, more imported sugar, er, ethanol. And that's exactly what will happen under CAFTA, explains the IATP report (at www.iatp.org), because "CAFTA adopts the CBI language for ethanol" ... and "makes the CBI allowances on ethanol exports to the U.S. permanent." As smelly as that will be for the farmers who grew the 1.26 billion bushels of corn used to make 3.4 billion gallons of American ethanol in 2004 -- and who now own 40 percent of the domestic ethanol production capacity -- it may get worse. U.S. Trade Representative Robert Portman calls CAFTA a "gateway" agreement that opens the door to the Bush Administration's bigger, hemisphere-wide Free Trade Area of the Americas, or FTAA In effect, the CBI-to-CAFTA-to-FTAA triple play will open the U.S. bio-fuels market to ethanol giant Brazil which, in 2003, produced 3.6 billion gallons of ethanol from sugar. It's a maneuver free-trading agbiz masters like Cargill appear to be banking on. In May 2004, Cargill announced a $10 million partnership to build a 63 million gallon ethanol dehydration plant in El Salvador to export Brazilian sugar-based ethanol into the United States duty-free under the CBI. In December 2004, Cargill and Brazilian commodities trader Coimex struck a deal to drop another $10 million in a Jamaican ethanol plant to, again, dehydrate Brazilian ethanol. On May 19, 2005, Cargill announced it would invest in one of Brazil's biggest sugar processors, a producer of about 50 million gallons of ethanol. The Renewable Fuels Association, ethanol's Washington, D.C., lobby, objects to IATP's assertion that CAFTA means greater ethanol imports. "They're allowed under CBI already," says spokesman Monte Shaw. OK, but why institutionalize what could be a flood of imported ethanol with CAFTA and FTAA? On second thought, ask your local National Corn Grower Association director, your county Farm Bureau president or the American Soybean Association -- all strident CAFTA and FTAA supporters -- why America needs to import any ethanol at all. Alan Guebert is a syndicated columnist who writes weekly for The Pantagraph. He lives in Delavan. His e-mail address is [EMAIL PROTECTED] _______________________________________________ Biofuel mailing list Biofuel@sustainablelists.org http://sustainablelists.org/mailman/listinfo/biofuel_sustainablelists.org Biofuel at Journey to Forever: http://journeytoforever.org/biofuel.html Search the combined Biofuel and Biofuels-biz list archives (50,000 messages): http://www.mail-archive.com/biofuel@sustainablelists.org/
