Cuba Plans Big Increase in Ethanol Production

Cuba Plans Big Increase in Ethanol Production

HAVANA - Cuba hopes to take advantage of high sugar prices and the
ethanol boom to revitalize its industry and greatly increase alcohol
production, a senior ministry official said Tuesday.

"Our country has begun an accelerated drive to increase alcohol
production, modernizing existing distilleries and installing new ones to
increase by five times installed capacity," Luis Galvez, director of the
sugar ministry's Sugar Cane Derivatives Research Institute, said.

Galvez, opening an international conference on the production and uses
of ethanol, said high oil prices and increased demand for ethanol had
created "perhaps the most promising moment ever" for the sugar industry.

Galvez said Cuba's annual output was just 1 million hectoliters, though
installed capacity was far greater.

Cuba, once the world's biggest raw sugar exporter, has reduced acreage
by more than 60 percent since 2003 and dismantled 71 of 156 mills.

Last June, 43 more mills were closed, though preserved, while this year
just 11 distilleries operated, most at well below capacity for lack of cane.

Reuters estimates final output this year at just under 1.2 million
tonnes of raw sugar, based on provincial media and source reports, the
lowest since 1908.

The Caribbean island consumes a minimum 700,000 tonnes of sugar per year
and 400,000 tonnes are destined for a toll agreement with China.

With sugar and ethanol prices soaring earlier this year, the government
decided to revitalize the industry, allocating money for inputs,
increasing the price mills pay for cane and opening joint-venture
negotiations.

Ministry officials have stated they expect at least a 15 percent
increase in output in 2007, and far more in 2008 due to a crash sowing
plan, more inputs and increased rainfall so far this summer.

The harvest runs from January to May.

"I think Cuba should rethink its policy of running down sugar. I am
seeing the minister this afternoon and will strongly encourage him that
there is a new life line for the industry coming up," Peter Baron,
director of the International Sugar Industry, told Reuters.

Baron, like other speakers at the event, was optimistic about the world
sugar industry's future, stating high oil prices and improved technology
had made ethanol an ever more attractive fuel.

"We may be at the most important moment for sugar in 100 years. Sugar is
no longer just a food commodity. It has become an energy commodity," he
said.

Story by Marc Frank

Story Date: 21/6/2006

http://www.planetark.org/dailynewsstory.cfm/newsid/36927/story.htm