Brazilian Ethanol Soon to Threaten American Producers?

The following is a portion of Brazilian President Lula's remarks with President George W. Bush in Sao Palo, Brazil March 9th concerning ethanol.

I take them to mean that Brazil is planning to use the export of ethanol to help its balance of trade. That, to me, sounds like it could have disastrous effects on America's ethanol industry if it can undercut our producers.

The full remarks are here:

President Lula's excerpt:

Ladies and gentlemen, Brazil is proud of having contributed to the decision by the U.S. government to increase the share of biofuels in its energy mix. I recall the enthusiasm with which President Bush was first exposed in the meeting we had in Brasilia in 2005 to Brazil's success story in terms of biofuel.

Here in Brazil, we have an extremely successful program, considered a model, which came out of the investment of over 30 years in research and development. It's a program which brings together respect for the environment with the preservation and intensification of the food security of our society. It's a program which has a major social impact because of its capacity to generate jobs, to strengthen family farming, and to distribute income.

This is a field where our two countries can cooperate. The memorandum of understanding on biofuels, which our ministers signed today, is a decisive step in that direction. Bringing together their efforts, the U.S. and Brazil can further push the democratization of energy and bring biofuels to all.

One of the most complex tasks that we face will be to assure access to major consuming centers. Brazil hopes that the ethanol market will be benefited by free trade, free of protectionism. That is the only way that the fuel of the future will be able to promote sustainable development. It also benefits poor and developing countries, by making trade a factor of prosperity for all. This will be a challenge about which I spoke at length with President Bush. We need to eliminate imbalances that still constrain world trade and that aggravate the asymmetries of today's world.

Meanwhile, President Bush didn't have a whole lot to say in response about ethanol:

The excerpt of President Bush's remarks:

We talked about foreign policy in our discussions. We spent time on Central America, and one of the messages we will send to our Central American friends is that one way to help develop your countries is for you to adopt ethanol and biodiesel industries.

If I were an U.S. ethanol producer, I would be very, very concerned.