Japan’s Itochu, US Bunge in 2nd Brazil bioethanol venture

12 December 2008 13:00  [Source: ICIS news]

TOKYO (ICIS news)--Japan's Itochu Corp has established a joint venture with US company Bunge to produce bioethanol and sugar in the Brazilian state of Tocantins, the company said on Friday.

Itochu will have a 20% stake in the venture and Bunge will hold 80%, Itochu said.

This was Itochu’s second bioethanol/sugar project with Bunge in Brazil after their Minas Gerais project was finalised in September, the company said.

The costs for the two projects are expected to total $800m, the company said.

In September, Itochu signed an agreement with Bunge to buy a 20% stake in Bunge’s Brazilian subsidiary, Agroindustrial Santa Juliana, and partner in the production of bioethanol and sugar.

For the new venture, the two companies plan to construct a plant in Pedro Afonso, Tocantins, which will produce 265,000 kilolitres/year of bioethanol and 190,000 tonnes/year of sugar, Itochu said.

The plant is scheduled to come on stream in 2010, with commercial production of sugar expected to begin in 2012, Itochu said.

The plant’s sugarcane crushing capacity will be 1.4m tonnes/year in the initial year, and the two companies planned to boost capacity to 4.2m tonnes/year at the peak of the plant’s operation, Itochu said.

The firms did not give a time frame for the expansion, however.

The power at the plant would be fuelled by biogases from sugarcane, and the companies plan to sell excess energy to other firms in Brazil, Itochu said.

The new bioethanol/sugarcane project in Tocantins was expected to provide jobs for 1,400 people, Itochu added.

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By: Tomomi Yokomura
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