Biodiesel Blending Begins in Brazil

New requirement goes into effect Tuesday.

Starting on Jan. 1, all diesel fuel in Brazil must be a 2% blend of biodiesel. According to Brazil's interim minister of Mines and Energy Nelson Hubner, the country's production capacity for biodiesel is more than three times the amount needed to meet the requirement.

According to Hubner, about $511 million in diesel fuel imports will be saved due to the mandate. Nearly all of Brazil's biodiesel is produced from soy oil, although they are trying to switch to a non-commodity source. The country is also looking at pushing up a mandate for a 5% blend to 2010.

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