Brazil plans June biodiesel auction after regulatory probe

14 May 2012 18:13  [Source: ICIS news]

MEDELLIN, Colombia (ICIS) --A revamped Brazilian biodiesel auction, put in place after regulators found indications of price collusion to keep prices high, is scheduled for June, the Brazilian Ministry of Mines and Energy confirmed on Monday.

Fuel distributors will now negotiate contracts directly with producers in government-organised auctions, the ministry said.

Under the previous auction system, contracts to supply biodiesel were signed with Petroleo Brasileiro (Petrobras), the state-controlled oil producer, which then sold it to distributors, who are required to blend 5% biodiesel in the diesel they sell.

Under the new system, biodiesel producers will be able to furnish distributors with three offers during auctions.

"The measures aim to ensure the best price, quality, supply regularity and reliability," Marco Antonio Martins Almeida, the Brazilian secretary of energy said.

The idea that led to this new type of auction is to reduce the interference of government and to allow the market to participate more in the pricing process, he said.

By: Leela Landress
+1 713 525 2653

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly