Mexico and Brazil have signed an agreement to work together on developing Mexico’s biofuels sector, strengthening ties between Latin America’s two largest economies, reports Bnamericas.
On Wednesday, Mexican Energy Minister Luz Elena González Escobar and Brazilian Vice President Geraldo Alckmin signed a declaration of intent covering cooperation in the production, regulation, certification, and use of biofuels.
Brazil is the world’s second-largest biofuels producer, after the United States. “Brazil has advanced technology in ethanol and is ready to share its expertise,” said Mexican Economy Minister Marcelo Ebrard at a press conference in Mexico City.
Mexico’s energy ministry said the country expects to benefit from Brazil’s experience in ethanol, sustainable aviation fuels, biodiesel, and maritime fuels. The two governments also signed a memorandum of understanding to encourage trade and investment.
The agreement comes as Mexico looks to deepen economic and political ties with Brazil amid increasing tensions with the United States. Ebrard also noted that Mexico is interested in learning from Brazil’s deepwater oil and gas exploration capabilities.
Although Mexico grows large amounts of sugarcane and corn — the main feedstocks for ethanol — it has little commercial biofuel production. The country also lacks a nationwide mandate requiring biofuels to be blended with gasoline or diesel.
In March, President Claudia Sheinbaum signed a new biofuels law aimed at spurring industry growth. The law encourages private investment and allows the government to provide financial, tax, and market incentives for biofuels.
Analysts say that if blending mandates are introduced, the sector could see significant growth. A July report by law firm Garrigues noted that mandatory targets “could give Mexico’s biofuels industry a major boost.”
