in Congress to Reap Profits from Biofuels Act
Biofuels Act by itself cannot address the most urgent problem of
exorbitant and soaring oil prices caused by foreign monopoly control.
Worse, only landlords and bourgeois-compradors like Rep. Juan Miguel
Zubiri and his co-authors are the ones who will benefit most from it.
Posted by Bulatlat
Going by the hype created by
its passage, Republic Act (RA) No. 9367 or the Biofuels Act of 2006 is the
silver bullet that would end all our energy woes. In fact, the law's
principal author, Rep. Juan Miguel Zubiri (Lakas, 3rd district of Bukidnon)
is now capitalizing on the Biofuels Act to boost his senatorial bid.
Unfortunately, the law cannot
address the most urgent problem of exorbitant and soaring oil prices
caused by foreign monopoly control. In the final analysis, only the
landlords and bourgeois-compradors like Zubiri and his co-authors are the
ones who will benefit the most from the Biofuels Act, a law that was
enacted at the expense of genuine agrarian reform.
Most ardent supporters
The Biofuels Act aims to
maximize the production of sugarcane and coconut in the country to supply
the needs of bioethanol and coco-biodiesel. Sugarcane has been identified
as one of the primary sources in producing bioethanol which under the law
is required to comprise at least five percent of the total annual volume
of gasoline sold and distributed in the country within two years from the
effectivity of the Biofuels Act. Coconut, on the other hand, will serve as
the feedstock for biodiesel that the law mandates to account for at least
one percent of all diesel engine fuels within three months into the law's
Aside from Zubiri, among the
most ardent supporters (i.e., co-authors of the bill) of the Biofuels Act
in Congress are some of the biggest landlords and bourgeois-compradors in
the Philippines. When the law was still pending in Congress, they started
to position themselves in the biofuels business which is expected to be
lucrative. These politicians and their families and/or their
landlord/bourgeois-comprador patrons are the ones who stand to gain from
the government's biofuels program at the expense of farmers and farm
Zubiri himself has an
interest in the sugar industry of Bukidnon. His father – who was
Bukidnon's third district representative (1987-1998) before his son took
over and is now the province's governor – was executive vice president of
the Bukidnon Sugar Milling Corporation (BUSCO) from 1975 to 1988. Zubiri
admitted that BUSCO has been working on feasibility studies as early as
2005 for facilities that work both as an ethanol distillery and sugar mill
in anticipation of the Biofuels Act.
Another author, Rep. Herminio
Teves (Lakas, 3rd district of Negros Oriental), has been pushing for the
construction of a projected P2-billion ($41.6-million, based on an
exchange rate of P48.10 per US dollar) integrated production complex for
ethanol in Negros Oriental. The complex would span four municipalities
(Sta. Catalina, Siaton, Valencia, and Sibulan) covering 214,116 hectares
of government land. The proponent of the project, the Tamlang Valley
Agricultural Development Corp., is 35 percent government-owned while 65
percent is controlled by a consortium composed of alcohol distillery Tau
Commodities and Teves' own family.
Teves, who owns agricultural
lands in Sibulan, Tayasan, and Sta. Catalina (all in Negros Oriental) is
also involved with Tolong Sugar Milling which is based in Sta. Catalina.
Sugarcane production is
expected to increase to meet the requirements of the Biofuels Act. At
present, the sugar industry can only supply 79 percent of the needs of the
five-percent bioethanol blend which is between 200 and 400 million liters
per year. The country therefore needs to expand the current 167,300
sugarcane farms in the country covering a total area of 344,700 hectares
to meet the bioethanol demand.
Estimates show that to
produce a minimum of 120,000 liters of ethanol daily, a sugarcane
plantation needs 7,000 to 8,000 hectares aside from the 10 to 20 hectares
for each ethanol processing plant. The Sugar Regulatory Administration
(SRA) already identified 237,748 hectares of new sugar fields, mostly in
Mindanao, that can be tapped to produce ethanol for fuel. These are found
in Maguindanao (69,550 hectares), Agusan del Norte and Agusan del Sur
(45,000 hectares), Palawan (20,808 hectares), Saranggani (19,700
hectares), Lanao del Norte (19,035 hectares), Cagayan (16,918 hectares),
South Cotabato (15,000 hectares), Isabela (12,337 hectares), Masbate
(8,000 hectares), Bohol (6,400 hectares), and Kalinga (5,000 hectares).
Aside from developing
sugarcane production for ethanol, government has also announced its plan
to launch massive propagation and cultivation of jathropa seeds covering
around two million hectares of unproductive and idle public and private
lands nationwide in order to produce some 5.6 billion liters of biofuel in
the next 10 to 12 years.
To implement the project,
government will provide lands to PhilForest Corp., corporate arm of the
Department of Environment and Natural Resources (DENR), under a 25-year
stewardship program. Philforest has opened pilot plantations or nursery,
in partnership with the Department of Agrarian Reform (DAR), in Carmen,
North Cotabato (5,000 hectares); Isabela, Cagayan (900 hectares); Pili,
Camarines Sur (20 hectares); Tigaon, Camarines Sur (20 hectares); and
Davao City (50 hectares). It is also negotiating with the DENR for
additional jathropa nursery areas in Regions I (Ilocos), II (Cagayan
Valley), V (Bicol), and XIII (Caraga) covering 167,107 hectares of land.
According to the pro-biofuels
lobby group Philippine Fuel Ethanol Alliance, increased ethanol production
in the country would create additional 300,000 new jobs. But the biofuels
program, in the long run, threatens to aggravate joblessness in the
countryside because the imminent loss of the farmers' land is a real
threat under the Biofuels Act.
An official of the Department
of Agriculture (DA) admitted that the conversion of sugar haciendas for
ethanol production will be a major consideration of the DAR in the
exemption of lands under the Comprehensive Agrarian Reform Program (CARP).
Because of rising oil prices, ethanol production is now considered a
strategic investment by the National Economic and Development Authority (NEDA)
and the DAR must therefore take into account the supposed "economic
benefits" of ethanol business ventures as against the actual physical
distribution of lands to farmer-beneficiaries.
At present, 55,285 sugarcane
farms in the country covering 83,772 hectares are either tenanted, leased,
or under various forms of tenurial arrangement while 799,700 coconut farms
with an area of 1.02 million hectares are in the same situation. Overall,
3.42 million farms covering 3.10 million hectares are either tenanted,
leased, or under various forms of tenurial arrangement. These figures do
not fully reflect the extent of non-ownership of agricultural lands in the
country considering the flaws in the reporting methodology of government
and flawed definition of ownership under the CARP.
Landlessness is bound to
worsen as landlords, including those who helped author the law, would
surely apply for land-use conversion, CARP exemption or use other schemes
such as corporative arrangements, contract growing, joint venture and
lease arrangement under the biofuels program. In a newspaper article, for
instance, Task Force Mapalad claimed that Rep. Iggy Arroyo (Kampi, 5th
district of Negros Occidental) has been conditioning the minds of farmers
in the family-owned Hacienda Bacan in Negros Occidental that the said
landholding would be exempted from the CARP under the biofuels law.
Arroyo, one of the Biofuels Act's co-authors, reportedly said that the
157-hectare hacienda would be converted for ethanol production and thus
exempted from CARP.
Furthermore, while the
jathropa program only targets "unproductive and idle" lands, there is no
guarantee that even lands covered by CARP, or even lands of CARP
beneficiaries, would not be included for jathropa production considering
the promise of high returns from such agribusiness venture.
PhilForest estimates that an
investor in a jathropa plantation could reap a 20 percent return on
investment on a petroleum price of only $46 per barrel and could further
increase as global oil prices go up. This was the case of the contract
growing scheme of San Miguel Corporation (SMC) in Isabela, northern
Philippines which promised huge profits and enticed not only the targeted
holders of stewardship contracts but also the Emancipation Patent (EP) and
Certificate of Land Ownership Award (CLOA) holders. Instead of profits,
the farmers incurred huge debts that now threaten their control and
ownership because the contract stipulates that the cooperative
commissioned by SMC to supply its cassava needs can take over the land of
farmers who incur debts for two consecutive harvest seasons.
Genuine energy security
There is no doubt about the
need to explore, develop and use alternative sources of fuel if the
country intends to achieve energy security and independence, as well as
long-term, sustainable national economic development. But the Biofuels
Act, conceived with the narrow and self-serving interests of landlords and
bourgeois-compradors, cannot address the most urgent issues that threaten
the country's energy security, namely exorbitant and soaring oil prices
and intense foreign monopoly control in the upstream and downstream of the
Energy independence can only
be achieved if energy resources are effectively controlled and managed by
the people through the state, and not by the landlords, bourgeois
compradors, and foreign corporations. A pro-people alternative fuels
program should not allow the wanton conversion agricultural lands for
biofuels production and ensure that genuine agrarian reform would not be
compromised. It will also ensure sustainability because potential crops
that would be used as alternative fuels would be truly developed,
including protection from unnecessary competition brought about by
Finally, even a genuine
alternative fuels program would not bring immediate relief to the economy
and people battered by exorbitant oil prices and unabated oil price hikes.
The most urgent problem today as far as oil is concerned is prices and the
only reform that can bring instant and meaningful solution to this problem
is to reverse the oil deregulation policy and institute price control.
Posted by Bulatlat
PRINTER-FRIENDLY VERSION ■
© 2007 Bulatlat
Permission is granted to reprint or redistribute this article, provided
its author/s and Bulatlat are properly credited and notified.