Colombian ethanol production totaled 341.87 million liters from January to October, up 10.5% from 309.44 million liters produced over the same period last year but still significantly below capacity on a flood of cheaper US imports, according to the Colombian Biofuels Federation, the country's largest trade group.
Ethanol producers complained Tuesday that their sugarcane-based industry has been hit unfairly by imports of US ethanol, which is made at a lower cost from corn. Production in Colombia has fallen sharply since US ethanol imports began in volume in 2016, after the two countries signed a free trade agreement.
Alfonso Santos Montero, vice president of the Bogota-based trade group known by its Spanish name Fedebiocombustibles, said the Colombian law passed in 2001 mandating all gasoline contain a percentage of alcohol was passed to reduce pollution from fossil fuels and create jobs. Sugar-based ethanol produced in Colombia saves roughly three times more carbon emissions than does corn-based ethanol from the US.
But Colombian producers have had trouble competing with US imports' lower costs, which average about $1.50/gal, compared with the $2.50/gal cost of Colombian ethanol. Colombian producers are preparing a lawsuit to make the government restrict the entry of US ethanol because it does not meet carbon emissions standards laid out in the 2001 law, Santos said.
Year-to-date ethanol production in 2018 has shown improvement year on year, as Colombian ethanol production in all of 2017 was 364.1 million liters, down 16.2% from 434.4 million liters in 2016.
Meanwhile, biodiesel production through October totaled 476.08 million liters, up 6.8% from 445.63 million liters produced over the same 10 months in 2017. Colombian biodiesel is made primarily from the oil squeezed from the fruit of African palm trees.
Colombian law dictates that 10% of each gallon of gasoline sold at the pump consist of ethanol. Every gallon of diesel sold to trucks, buses and heavy equipment operators contains 10% biodiesel.
Roughly 40,000 hectares of sugarcane crops in Colombia are dedicated to ethanol production, while 500,000 hectares of African palm crops are earmarked for biodiesel production, Santos said.
Santos said the ramp-up of the country's largest ethanol complex - the Bioenergia facility in eastern Meta province, which includes a 20,000-hectare sugar plantation as well as a 500,000 liter/day processing plant - has been slowed by the impact of US ethanol imports.
Owned by state-controlled Ecopetrol, the plant is currently producing only about 150,000 liters per day and has 6 million liters of excess ethanol in storage, he said.
According to US Energy Information Administration data, US ethanol exports to Colombia over the first nine months of 2018 totaled 876,000 barrels, or more than three times the 275,000 barrels shipped there over the same period in 2017.
With the addition of Bioenergia, Colombia's aggregate installed capacity at its seven ethanol plants is currently at 2.3 million liters per day, but output is running at an average of about 1.6 million liters produced daily, or 70% of capacity, because domestically produced ethanol cannot compete with US products, Santos said.
