Market supply and Biofuels - Peru / Jul. 2008

July, 2008
By Dr. Javier Prado Blas 1

In August 2003, was issued in Peru the Market Promotion Act of Biofuels - Law 28054, this law has among other objectives promote agro-industrial development to generate employment and reduce environmental pollution. It also defines biofuels as chemicals that are derived from agro-industrial raw materials of origin or other forms of biomass and comply with quality standards established by competent authorities. Two years later, in 2005, this law was regulated by Supreme Decree N°013-2005-EM, which defines biodiesel as an oily substance obtained from palm oil, castor, soya, sunflower and other vegetable oils. On the other hand, there is a term that BioOil in North America is synonymous with oil fast pyrolysis, while in Europe, BioOil has a much broader definition, which covers other biomasses, such as palm oil, other vegetable oils and acids.

In January 2008, was issued Supreme Decree N° 004-2008-AG declaring national interest installing plantations Cana Brava, a species native of Peru, biomass of rapid growth that does not compete with food crops, occupying lands that have been deforested and that its use is expected to promote biofuel production on a large scale in the context of sustainable development and socio-economic, especially in the Amazon region and contribute to management useful and beneficial to soil and water resources, as what defines Ministerial Resolution No. 0521-2008-AG in the National Plan for the promotion of wild cane 2008-2020.

Approved the National Plan of Samoa Fiber (Caña Brava)- RM N° 0521-2008-AG
Foto: Samoa Fiber Holdings
Brazil, almost 5 million hectares of land for Biofuels; Colombia in recent years implemented more than 160 thousand hectares to biodiesel. Argentina is doing the same to the intensive cultivation of soybeans. In Peru, cultivation of plant species for development of biofuels on a large scale, either industrial or commercial, is still small compared with other countries in the region above the Americas therefore not currently reaches 30 thousand hectares across the country. This amount of land allocated to biomass to produce biofuels fail to cover the 0.5% of their land forested.


In Peru there are more than 7 million hectares of deforested 2 and they almost 50% have occurred in 3 regions: San Martin, Amazonas and Loreto, as well as half of the total deforested area was carried out by small informal agriculture, immigration and subsistence, characterized by logging, rubbing and burning forests. The soils are so productive for a short time until the arable soil layer disappears and then abandoned, continuing with successive transfers to other spaces by increasing the deforested areas.



The situation caused by the planting of oil in terms of biomass for biofuels could reverse the impact generated by the effects of increased pressure on land that in recent decades served to dramatically deteriorate not only the forests but the quality of life in general populations in the Peruvian Amazon.

The State and the Peruvian Government, through its Ministry of Environment defined its position on biofuels on four points: First, biofuels are welcome because they can generate rural employment; second, for their production will not be allowed cut primary forests, is eriazos should use the land or deforested; third, will not be allowed to areas that are dedicated to growing food intended for cultivation for biofuels because they protect the country's food security; and fourth, if cultivated on the coast should implement systems most modern irrigation so as not to generate conflicts over water.

The rules provided for the land use planning, allow intensively promote the exploitation of this type of biomass and biofuels for Agribusiness, pushing the process of physical law of the land very long to develop greater investment, which will give an initial value stage 150 thousand hectares of land.

There is growing expectation for the development of biofuels, since there are 30 investment projects for the production of Biofuels registered by the Office of Agricultural Promotion of Peruvian Ministry of Agriculture. Located on the coast, with the cultivation of sugar cane (Piura, Lambayeque, La Libertad); mountains, where he drives in communities altoandinas growing canola and jatropha well in the bush cultivation of oil palm, wild cane and other biomass (San Martin, Ucayali, Loreto).


At the legal framework promoter of private investment, immediate availability of abundant labor, farming and agro-industrial technology available, professional and technical personnel qualified technician, tax benefits for investments in the Amazon, among others, are compounded by the fact that Peru has entered into the mechanism of the Organization for Economic Co-operation and Development (OECD) to assure international investors on the conditions they will encounter in the country.


The enormous potential for producing biomass Biofuels allow Peru offered to world markets extensive reserves of low-cost biomass sources certified, sustainably managed forests, forest residues sources and sources of energy crops that can reach to become center exports, such as brazil and installed industrial plants producing the new fuels Peru could fall between the Centers for producing fast pyrolysis oils (BioOil) to meet the global market for biofuels dissatisfied.

1 Doctor of Environment and Sustainable Development, an expert on Development and Project Management from biomass.

2 Map of the Peruvian Amazon Deforestation. Draft PROCLIM - INRENA-CONAM, 2005

3 El Comercio
4 OECD