Jamaica Broilers Ethanol To Double Capacity

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Friday, July 25, 2008

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Jamaica Broilers Ethanol To Double Capacity

Jamaica Broilers Ethanol Limited, a subsidiary of the Robert Levy and R Danny Williams controlled Jamaica Broilers Group, Limited will be spending $15 million (J$1billion) to expand its ethanol production facility to 120 million gallons per annum, while employing 15 per cent more workers.

Christopher Levy, vice president in charge of operations at the Jamaica Broilers pointed out that the expansion programme will commence in December of this year, and that the company will continue to import raw material, hydrous alcohol from Brazil, extract the water from it and then export it to the United States (US) under the favourable terms of the Caribbean Basin Initiative (CBI).

Under the CBI which was negotiated by former Prime Minister Edward Seaga and former US president Ronald Reagan in 1983, producers of ethanol in the Caribbean have duty free access to the US market, while their counterparts in Brazil and other South American countries face a duty of US 52 cents per gallon.

The demand for ethanol in the US is increasing rapidly as President George W Bush seeks to reduce the country’s dependence on oil, amid galloping and unpredictable energy prices. America is currently consuming almost 20 per cent of the world’s daily oil demand or some 20.3 million barrels.

Levy also argued that ethanol could become the country’s third largest net earner of foreign exchange in three years time when Infiniti the Brazilian conglomerate, which recently acquired the loss making Sugar Company Jamaica (SCJ) starts to produce and export.

Levy pointed out that Petrojam Ethanol’s operations will be rolled into that of Infiniti.

Infiniti acquired the SCJ in order to exploit the country’s duty free access to the US market, which makes it more efficient and profitable to export ethanol to the US market. Brazil currently has a contract with the Bush administration to supply a significant portion of the ethanol needed to help American reduce its dependence on oil by 30 per cent in 20 years time.

Meanwhile, Levy also pointed out that the group was very pleased with the performance of JB Ethanol during its first 10 months of operations.

Meanwhile, Karl Samuda, minister of industry, commended Jamaica Broilers on its plans to expand JB Ethanol, and said the government will be fighting to make the benefits of the CBI permanent.

Samuda also pointed out that although there is a national plan to introduce flexi vehicles Jamaicans do not have access to ethanol service stations and as a result, the government will be paving the way for the opening of a number of these stations.

He also contended that ethanol will be a viable alternative fuel source as long as crude oil prices continue to climb.