Time to rethink ethanol

Time to rethink ethanol

Australia is in the midst of a cost-of-living crisis, which shows no sign of letting up any time soon. 

The price of everything from housing to groceries is skyrocketing and continual rate rises by the Reserve Bank are doing little to stem the soaring inflation.
Every day we hear heartbreaking stories of the pressure rising costs are putting on families. 

Whether it’s seniors foregoing healthcare check-ups to reduce medical bills, or single parents skipping meals so their children don’t go without, everywhere we look people are struggling to make ends meet.

Of course, beyond creating employment in the regions and contributing billions of dollars to the national economy, there is little the sugar industry can do to help ease these cost-of-living pressures.

However, there is one place where, with the appropriate government support, the sugar industry could significantly reduce costs on everyday Australians – at the bowser.

The soaring price of petrol, now regularly over $2 a litre in many places, is a massive burden on Australian families.

Right now, there is little we can do to influence that price, we are totally at the mercy of the global oil market.

But many Australians might be surprised to learn that other sugar producing nations have much greater control over their domestic fuel prices.

Brazil, for example, uses its sugar industry extremely efficiently to keep the cost of fuel low for consumers.

It does this by switching seamlessly between sugar production and ethanol production, depending on the prevailing global conditions.

When the world sugar price is high, Brazilian mills will produce more sugar. When the sugar price is low, but oil prices are high, mills will produce more ethanol.

The end result is Brazilians pay significantly less at the bowser than Australians. Currently Brazilian motorists are paying around 3.3 Brazilian Reais per litre of petrol, the equivalent of one Australian Dollar. Can any Australian remember the last time they paid $1 for a litre of petrol? I know I can’t.

And Brazil is not the only country seeking to keep fuels costs low through more efficient use of its sugar industry. India has already boosted ethanol production in recent years and is expected to divert more than six million tonnes of sugar annually towards ethanol by 2025.

Australia can do this too, albeit on a smaller scale. But for this to happen, we need state and federal governments to work with the industry to fund ethanol production and storage facilities.

This could not only significantly reduce the price Australian’s pay for fuel, easing cost of living pressures, it would also boost our national fuel security, making us less susceptible to global shocks.

We live in a large country, with limited or no public transport options outside major cities. Cars are a necessity. 

There is no reason Australian families should continue to pay through the nose simply to carry out their day-to-day lives. Especially when, with a little bit of courage and foresight, we could follow the lead of other sugar producing nations and take control of our own fuel destiny.