Business

Brazilian biodiesel producers warn of shortage risks after regulation change

The federal government has decided to abandon auctions for biofuels, ordering instead that producers negotiate purchases directly with distributors. The former are reeling, claiming it will drastically affect their business

biodiesel regulations
Photo: Adriano Vizoni/Folhapress

As of January 1 next year, sales of biodiesel in Brazil will be carried out directly between soy producers and distributors, putting an end to public auctions conducted by the National Oil Agency (ANP) and intermediated by Petrobras since 2005. The decision was already part of a resolution issued last December, but was finally made official last week — and has drawn much irritation from biodiesel manufacturers.

To justify its approval, Brazil’s National Energy Policy Board (CNPE) alleged that the new sales model will “provide more freedom to agents and less state intervention, which is more adherent to the...

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