Report Highlights Benefits of Brazilian Sugarcane Ethanol, Confirms Highest Emissions Savings

International Food Policy Research Institute tells European Commission that Brazilian sugarcane ethanol saves the most greenhouse gas emissions, even considering indirect land use changes.

BRUSSELS, March 29, 2010 - A landmark report by the International Food Policy Research Institute
(IFPRI) titled "Global Trade and Environmental Impact of the EU Biofuels
Mandate" has concluded that more open trade in renewable fuels will enable
Europe's biofuels policy to deliver on its commitment to reduce carbon in
transport, mainly because the most emission-efficient biofuel will be
utilized: Brazilian sugarcane-based ethanol, which reduces greenhouse gas
emissions by about 90% compared to petrol.

"The report, prepared for the European Commission, shows that Brazilian
sugarcane ethanol production will have virtually no impact on food prices, is
highly competitive on the European market and provides the most significant
reduction in greenhouse gases (GHG)," says UNICA's Chief Representative in
the European Union, Emmanuel Desplechin.

UNICA welcomed the Commission's efforts to engage independent experts in
its assessments but called for improvements in the current analysis. "The
report currently contains a certain number of inaccuracies, so once these are
corrected, we anticipate even higher benefits resulting from the use of
Brazilian sugarcane ethanol. For example, the type of land for sugarcane
expansion highlighted in the report does not take into consideration the
agro-ecological zoning for sugarcane in Brazil, which prevents cane from
expanding into any type of native vegetation," Desplechin added.

A 2008 study published by The Netherlands' Wageningen University forecast
that about 62% of the expansion of sugarcane in South-Central Brazil, the
heart of the country's sugarcane harvesting region, would take place
primarily on pasture land, while 37,8% would happen in lands previously
occupied by other crops. The projection covered the period from 2008 to 2018.

As Europe progresses towards workable solutions to reduce global climate
gases, one of the world's biggest challenges, UNICA is urging the European
Commission to engage in a comprehensive stakeholder consultation process, to
ensure accuracy of data, multiplicity of positions and constructive
recommendations for improvement.

"An open and transparent consultation process will enable European policy
makers to reach decisions that meet equally the interest of markets,
consumers and the environment," Desplechin said. "As the U.S. Environmental
Protection Agency and the State of California have recognized, Brazilian
sugarcane ethanol is an advanced, low carbon biofuel that dramatically
reduces greenhouse gas emissions. Sustainably-produced, sugarcane ethanol's
environmental performance can reduce Europe's carbon footprint and help meet
the 10% target of renewable energy use in its transport sector," Desplechin
concluded.

To download the report "Global Trade and Environmental Impact of the EU
Biofuels Mandate", please go to:
trade.ec.europa.eu/doclib/html/145954.htm

To download the full report from Wageningen University, please go to:
tinyurl.com/sugarcaneethanol

ABOUT UNICA

The Brazilian Sugarcane Industry Association (UNICA) represents the top
producers of sugar and ethanol in the country's South-Central region,
especially the state of Sao Paulo, which accounts for about 50% of the
country's sugarcane harvest and 60% of total ethanol production. UNICA
develops position papers, statistics and specific research in support of
Brazil's sugar, ethanol and bioelectricity sectors. In 2008, Brazil produced
an estimated 565 million metric tons of sugarcane, which yielded 31.3 million
tons of sugar and 25.7 billion liters (6.8 billion gallons) of ethanol,
making it the number-one sugarcane grower and sugar producer in the world,
and the second-largest ethanol producer on the planet, behind the United
States.

english.unica.com.br

    MORE INFORMATION:
    CDN Corporate Communications - Sao Paulo, Brazil

    Rosa Webster - +5511-3643-2707 / rosa.webster@cdn.com.br
    Mariane dos Santos - +5511-3643-2730 / mariane.santos@cdn.com.br

CDN Corporate Communications - Sao Paulo, Brazil, Rosa Webster, +5511-3643-2707, rosa.webster at cdn.com.br, or Mariane dos Santos, +5511-3643-2730, mariane.santos at cdn.com.br