Sweet! Ethanol in Mexico

Between narcos trying to bump them off and guys tossing grenads into newspaper offices, I am happy there are ANY reporters working in Mexico.  As if the bad guys weren’t enough to deal with, they have editors like the ones at Nuevo Excelsior who don’t seem to cut and paste two reports together without reading the paragraphs. 

I know I have a lot of trouble editing THIS site, but then I’m working with a FUBAR computer that crashes regularly and an obsolete version of “OpenOffice Writer” (the free knock-off version of Word) that sometimes does strange things to my copy (the previous post took two hours to straighten out, between crashes and losing the HTML coding, which I finally just stripped out completely).  Dealing with that, sometimes I just don’t even notice that I’ve changed sentences on the fly, or lapsed into my semi-dyslexic spelling mode.  

So, this is no reflection on reporters  Alejandro Sánchez and Carole Simonnet, who wrote the story in yesterday’s Nuevo Excelsior on a new biofuels bill… just an overly long explanation of why the translation doesn’t read anything like the original:

After a two years and four month delay, the Agriculture and Livestock Committee finally agreed on a bill that will allow the production and use of ethanol additives in gasoline, and have sent an alternatives energy bill to the full Chamber of Deputies.

In the Committee’s opinion, the bill is “needed to promote national agricultural industries by processing agricultural products that can be used into ethanol and other biofuels.”

The committee discussed the bill behind closed doors, emerging with 19 votes in favor, all from PRI and PAN. One PAN member abstained. The PRD voted against the measure, which it claims only benefits a few powerful interests in the country and in the United States.

If approved, the State would be required to set up production, distribution and sales facilities for biofuels, and to encourage their use. The Bill’s sponsors say the proposal meets the Constitutionally mandated responsibilities of the Federal government, which under Article 25, 27, fraccion XX and 28 deal with energy production, distribution and ownership.

PRI Committee member Rubén Escárcega told Excelsior that the full Chamber will still have to consider the rules under which private interests, foreign or national, can invest in ethanol production, and the percentage of ownership reserved to the Federal government. .

Adriana Díaz of PRD accused the Committee of a “surprise attack, scheduling a vote without time set aside for debate.” She said her party will try to block the bill on the floor of the Chamber. The PRD plans to introducing a motion to suspend debate and to consider an substitute bill.

The bill put before the Chamber emphasizes that sugar cane will be used to produce ethanol. Mexico is the world’s seventh largest sugar grower, and the eighth largest sugar consumer. It is the number three county in terms of the number of tons of cane produced per hectare and number four in yield per hectare.

Those voting in favor of sending the Bill to the floor argue that the legislators are assuming their responsibility to lower emissions and “joining our brothers around the world in the fight against global warming and the almost apocalyptic visions of the future which the UN scientific panel discussed two months ago in Paris.”

At the same time, they maintain that the intent of the bill is to improve national energy self-sufficiency and that using renewable energy will encourage agricultural production and create productive employment in the bio-energy related businesses.

However, the PRD legislator said that consideration of alternative energy should look at all alternatives, and not depend on separate legislation of solar, biomass, geothermal and wind energy bills, and not “just lean towards ethanol.”

While I don’t think this is a bad bill, though I think the PRD is right that alternative energy should be considered holistically, and not piecemeal, I recognize that this is a bailout for the troubled sugar industry. It had to be re-nationalized under the privatizing Fox administration, as the price for keeping the Morelos farmers from running amok in Cuernavaca, like they were threatening to do.

The farmers got screwed when the sugar mills (which were originally turned into cooperatives by Emiliano Zapata’s Ejército Liberator del Sur). Under Lazaro Cardenas, sugar mills were nationalized. Under Salinas and Zedillo, they were privatized to “save” them from going broke when they couldn’t compete against the U.S. subsidized “private” sugar companies (all owned by Republican party contibutors), then went promptly belly-up.

They were only renationalized when there were a lot of angry farmers in the streets of Cuernavaca shaking their machetes outside the state house (I lived there at the time, and though I never felt threatened, I got the “point” that some hungry, skinny guys might get tired of getting jerked around).

Then… NAFTA regulations forced Mexico to accept corn-based sweeteners (made by our friends at Cargill) which basically made sugar worthless in a sugar-growing country. It only took the Chamber two and a half years to get out of committee what seems like an obvious way to deal with all that sugar.

And, this should buy PEMEX a little time (I’m guessing PEMEX will be getting into the sugar business). And, maybe the farmers can get into the PEMEX pension plan. Plus… something I only thought of a second ago, this will shut up all the folks who insist that Mexico open the energy sector to more foreign investors. The foreign investors who are the most experienced at sugar-cane based ethanol production are the Brazilians, and they based their energy production largely on the Mexican model.

The Mexican State is going to remain in control of energy production, with maybe some inter-Latin American investment, the farmers might get a decent price and it’s a neat way around the NAFTA-thinking that insists agriculture has to be commercial enterprise.

Besides, in Mexico, candy-bar commercials always say “Azucar es un buen fuente d’energia”… “Sugar is a good source of energy.” Sure is.