In Mexico, protests halt legislation on ethanol(1)

Farmers' protests and the rise in corn tortilla prices in late December put temporary brakes on the Mexican Senate, which was preparing to lift the national ban on utilizing maize to make fuel alcohol, or ethanol.

Stopping the legislative effort were the senators of the Institutional Revolutionary Party (PRI), which is intent on recovering the presidency in 2012, held by the National Action Party (PAN) for the last two terms.

"The problem remains, though dormant, because there are many interests of (ethanol-producing) companies in the United States, Colombia and Brazil," said Víctor Suárez, executive director of the National Association of Rural Commercialisation Enterprises (ANEC).

The policy shift is included in the bio-energy bill that former senator Mario López Valdez had pushed for two years. Lopez, a former PRI militant and senator, switched to the PAN. He is now governor of the northwestern state of Sinaloa. The bill was approved in committee by all political parties and presented to the Senate on Dec. 9.

The law bans the use of maize to make ethanol when there is a production deficit. The reform aims to replace the national ban with a regional approach, such that states with surplus maize, like Sinaloa -- where an ethanol plant is already operating, run on imported maize -- can shift it from the food market to the biofuel production market.

The non-governmental campaign "Sin Maíz No Hay País" (roughly, "without maize, there is no Mexico") issued an alert against the legislation, which ultimately was put on hold, while in the last days of 2010 the price of the corn tortilla, a staple in the Mexican diet, shot up 50 percent.

According to the federal government, Mexico imports 10 million tons of yellow maize annually, using it for livestock feed. It meets 30 percent of the national demand at a cost of 3 billion dollars, according to Sin Maíz No Hay País.

The insufficient national maize production was one of the reasons for the 2008 authorization to cultivate genetically modified maize in Mexico, the cradle of this millennia-old grain.

The argument in favor of the initiative is that the reform would benefit the small farmers in those regions, because it would allow them to sell their maize freely, without endangering Mexico's food security. Furthermore, the reasoning goes, it would reduce reliance on fossil fuels because ethanol, utilized as a substitute for or complement to gasoline in automotive transport, emits less climate-changing gases into the atmosphere.

The federal authorities would be entrusted with regulating maize-based ethanol in case of food emergencies, yield fluctuations or other phenomena that could lead to maize shortages or stockpiling, periodically reviewing the grain's supply.

"It's madness whose sole purpose is to enrich the big farmers," said Suárez. "We are in the middle of this foolishness, and with 20 percent of the Mexican population living in extreme poverty and with 45 percent of the food imported, we enter into this scheme of wanting to produce ethanol using a staple food," he said. "Furthermore, without subsidies, ethanol is not economically profitable."

According to the government's National Council for Social Development Policy Evaluation, in the first four years of President Felipe Calderón's administration, begun in 2006, the proportion of people who were unable to meet their basic food needs rose from 14.4 percent to 18.2 percent.