Ethanol: the industry in which Córdoba is increasingly a leader, but which fears for its continuity


In 2020, four out of every five liters of corn-based bioethanol were manufactured in Córdoba. The companies Promaíz, by Alejandro Roca; ACA Bio, from Villa María; and Bio 4, from Río Cuarto, produced 335.6 million liters, 79.2 percent of the total national production of 423.5 million liters, according to data from the National Energy Secretariat.

Córdoba thus consolidated its leadership in the sector, with the highest historical participation, far exceeding the average of 70 percent since this industry began operating in Argentina in 2013.

Likewise, if the ethanol produced from sugar cane is added (385.1 million liters), local production represented 41.5 percent of the total (808.7 million).

Behind Córdoba, Tucumán –the main “sugarcane” area of ​​Argentina– participated with 27 percent; and then Salta, Jujuy, San Luis and Santa Fe are staggered.

But this 2020 photo hides a negative side: the 335.6 million liters produced in Córdoba represent a fall of 9.1 percent compared to the 369.3 million liters in 2019 and 22 percent compared to the peak of 430 million liters of 2018.

It is also the lowest figure in six years, since the 283.9 million in 2014, when two of the three factories (Promaíz and ACA Bio) were just starting their activity.


This downward path is explained by both conjunctural factors and structural reasons.

It is worth remembering that bioethanol is used to “cut” 12 percent of gasoline. For this reason, its demand depends on the consumption of fuels, which has been falling as a result of the economic crisis facing the country, to which was added last year the blow of the Covid-19 pandemic that led to the activity of service stations. to an all-time low.

But the structural is what fits the most on the agenda of concerns of businessmen. The bioethanol industry was armed on the basis of Law 26,093, enacted in 2012, which established a “regulation and promotion regime for the sustainable production and use of biofuels.” The legal framework contemplated a formula for a monthly update of prices, based on cost indicators, amortizations and a sustainable profitability for the business.

The oil companies, forced to pay the ethano companies this officially set price, from the beginning did not agree very much and in April 2019 the first obstacle arrived: the government of Mauricio Macri eliminated the formula and began to apply increases in a discretionary manner. , without the industrialists knowing in a timely manner the parameters that were taken for the updates.

This complicated the business and the second major stumbling block was the change of government: in December 2019, President Alberto Fernández decided to freeze the price of fuels sold to the public and this, due to a transitory nature, affected bioethanol producers.

Only in October 2020, the value was updated, but only by 10 percent. In the middle, the main input, which is corn, doubled its international price. The result was that in almost the entire second semester the industry worked at a loss, to the point that there were plants that paralyzed their production.

Provisional improvement

Finally, after the Justice endorsed a proposal from Bio 4 to re-apply the formula established by law, at the beginning of 2021 the Government announced a gradual rise in the prices of biofuels that has given companies air.

“Today the corn bioethanol industry has a cost of 46 pesos per liter and the sale price is 47.80. After a last quarter of 2020 in which the variable costs exceeded the sales price of the domestic market, at this moment we have a slight profitability “, said Víctor Accastello, manager of the Department of Agricultural Supplies of the Association of Argentine Cooperatives (ACA).

“With the agreed prices until May, we are working well, with the capacity at 100 percent. It is not that we are winning, but at least it is not a situation of bankruptcy like at the end of last year ”, confirmed Manuel Ron, president of Bio 4.

From Promaíz, meanwhile, they also indicated that they are almost at maximum installed capacity and closed January with more than 16 million liters delivered.

However, this is just an upbeat photo in a drama thriller for the ethanol companies. It happens that in May the term of validity of Law 26,093 expires: the extension of the same already has half a sanction in the Senate, but it is locked in the Chamber of Deputies.

And the situation has generated a lot of controversy: the companies and the Government of Córdoba demanded that this extension be included in the agenda of the extraordinary sessions and that did not happen. Now they hope that it will be one of the first projects to be addressed in the ordinary legislative period.

But in the sector they distrust the president of the Lower House, Sergio Massa, for two reasons: pressure from YPF not to address this initiative and the proximity of the former mayor of Tigre with the Bulgheroni family, owner of Pan American Energy (PAE) , another oil company that distances itself from a differentiated policy for biofuels.

“The current price agreement served to get us going again, but without profitability and without a horizon, because everything expires in May and we do not know how the film continues. We are navigating a sea of ​​uncertainty, ”complained Patrick Adam, executive director of the Corn Bioethanol Chamber.

“In 60 days the law expires and there is no definition. Everything is politically rarefied, a lot of uncertainty and our focus is on solving the issue of regulation that will affect biofuels in the medium and long term ”, added Manuel Ron.

Accastello was even more critical: “The great uncertainty is how the industry continues as of June. There are two oil companies that are exerting all their power of lobby to destroy the biofuel industry. They want them to have a free price and they can participate in their production ”.


An additional problem is that two years ago a political entity called the “Bioenergetic League” had been set up, made up of companies and governments that produce biofuels in their territories.

In the case of ethanol, the problem is that a historical dispute between sugarcane-based producers and those who make it with corn has been reborn.

For five years, sugarcane had a better price than corn. That was equated in December 2019. But now the industrialists of Cordoba fear that a new law will be formulated that favors those from the north, who have greater political ties with the national ruling party.

During his recent visit to Tucumán, President Alberto Fernández said that ethanol producers did not have to worry, that they would be able to continue producing and investing.

Make no mistake: that was not a message for everyone. There is a pro-cane and anti-Cordoba / corn bias in everything the government is preparing, ”one of the sources in the sector consulted mentioned.

That the message has been expressed in Tucumán, governed by Juan Manzur – a politician who became Cristina Fernández’s Minister of Health – is quite a sign, they say in the industry. On the other hand, the Government of Córdoba was left practically alone claiming for corn ethanol, just at a time when relations with the central power are getting worse. Meanwhile, Córdoba approved its own law to promote biofuels.

“The League no longer exists. Only our Province is fighting for the extension of Law 26.093 as approved by the Senate. NOA is negotiating a special regime for sugarcane bioethanol, with a price formula and a special quota for them ”, Accastello explained.

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