John Myers Jr, Senior Reporter

In this June 2008 file photo, Minister of Industry, Investment and Commerce, Karl Samuda (second right), is accompanied on a familiarisation tour of the JB Ethanol plant at Port Esquivel by (from left) John Carberry, plant manager; Robert Levy, president and CEO of the Jamaica Broilers Group, and Chris Levy, senior VP of operations at the Jamaica Broilers Group. - File

The Jamaica Broilers Group (JB) says it will go ahead with the $1.1-billion plan to double the size of its 60-million gallon ethanol-processing plant here, despite the drop in the price of the commodity in the United States, JB's main market.

"Ethanol (price) moves up and down quite a bit, but a lot depends on where you are positioned in the value chain," Chris Levy, JB's senior vice-president, with responsibility for ethanol, told Wednesday Business.

"I think we are in very good position," he said. "I am pretty sure with arrangements that we have it will make us good money."

Jamaica Broilers, an agro-processing outfit, is better known for chicken and fish production, but has recently been moving to diversify the group.

$1-billion plant

It commissioned JB Ethanol Limited in August 2007, having spent just over $1 billion to build the plant, positioning itself to take advantage of Jamaica's strategic plan to grow sugar cane primarily for ethanol rather than sugar, whose preferential market in Europe is eroded.

Jamaica and other Caribbean Basin countries have export preference for ethanol in the United States, where they can supply up to seven per cent of the market's requirement without having to pay duties.

In its first 10 months of operation, JB Ethanol grossed $6 billion in profits on its export of 45 million gallons of fuel-grade ethanol to America.

JB Ethanol import is feedstock of hydrated alcohol from Brazil, which it turns into 'dry' or fuel-grade ethanol to be used mainly as an octane-enhancer in gasolene.

Jamaica itself is moving to ethanol/gasolene mix, having last month launched an E10 gasolene with a 10 per cent mix of ethanol, displacing MBTE.

The use of E10 is to become compulsory next year - a factor in the decision by Brazil-based Infinity Bio-Energy to buy the loss-making state-owned Sugar Company of Jamaica.

High oil prices helped to make ethanol - and other biofuels attractive business options - but the recent tumble by crude has also dragged down ethanol, raising questions of viability.

Ethanol has slipped from US$2.90 per gallon in July to about US$1.60 per gallon at present.

But even as some producers struggle in the face of the slump, Levy remained optimistic about the prospects for JB's operation, projecting that the expanded facility would be in operation by next March.

"I think we are good in that regard," he said.

Jamaica is currently the Caribbean's largest ethanol producer.

Already four companies - including one that is state owned, Petrojam Ethanol, which was also a sweetener in the Infinity Bio-Energy deal - export fuel-grade ethanol to the US.

john.myers@gleanerjm.com.