After the drought that the United States went through this summer, the crops turned out to be very poor. Corn supply is low and the cost per bushel is near record highs. About 40% of the corn supply is used for US ethanol. One place that the US could look for an alternative to corn is Brazil. They use a process with sugar that can produce ethanol. It is more expensive at the moment, but it is something to think about. Brazil holds the comparative advantage over the US with sugar, while the US holds the comparative advantage with corn. Brazil can supply the US with the sugar based ethanol and the US can focus on exporting the corn to places that have poor farming land such as Africa.
The US EPA currently requires fuel companies to use 500 million gallons of advanced biofuels to blend into gasoline. Brazil is the only ethanol industry in the world big enough to currently meet the US biofuel standards. The EPA is expected to raise the requirements to over three times the current amount, up to 1.75 billion gallons. This could enable Brazil to open many more ethanol plants, creating thousands of jobs and strengthening the Brazilian economy.
http://www.chicagotribune.com/classified/automotive/sns-rt-us-ethanol-brazil-exportsbre88j14j-20120920,0,3369514.story?page=1
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