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Institute for Agriculture and Trade Policy

Patents: Taken for granted in plans for a Global Biofuels Market

Steve Suppan

Institute for Agriculture and Trade Policy

October 2007

SARPN acknowledges Eldis as a source of this document: www.eldis.org
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Climate change mitigation and reducing petroleum dependence are the most publicized imperatives for increasing biofuels production. But some governments also cite rural development, increased employment, and efficient use of agricultural plant and animal residues, among other rationales for developing a global biofuels market. Entrepreneurs and trade lobbyists tout rules to liberalize biofuels trade as a way to resolve differences over agricultural subsidies and restart the Doha Round of World Trade Organization (WTO) negotiations.1 Toward replacing a small but increasing part of petroleum-based fuels with biomass-derived fuels, governments, United Nations agencies, publicly funded international financial institutions and private firms are investing in the creation of global and regional biofuels markets, perhaps most prominently through the recently launched Global Bioenergy Partnership.2

“[I]n 2004, total ethanol trade was around 3 billion litres, total ethanol production was around 32 billion litres and total crude oil trade was around 920 billion litres.”3 In 2005, Europe produced about 89 percent of all bio-diesel, with Germany alone producing 54.5 percent.4 In 2006, the U.S. led the world in ethanol production with 4,855 million gallons, Brazil produced 4,491 million gallons, followed by China (1,017 million gallons) and India (502 million gallons).5

In relation to this “fast moving train,” there is little public discussion about patent policy and the cost of patent royalties and licensing fees in the development of biofuels, whether globally traded or locally produced for local consumption. In official documents and international initiatives, there is also little mention of patents as part the global biofuels market. For example, in the “Brazilian Agroenergy Plan 2006-2011,” there is not a single word about patents. Within the United Nations Energy task force report “Sustainable Bioenergy: A Framework for Decision-Makers,” neither patent policy, patent enforcement, royalty and licensing fee costs, nor the role of traditional knowledge and genetic resources in patented biomass products are considered to be sustainability factors. In UN Food and Agriculture Organization’s “International Bioenergy Platform,” patent issues are not part of its “knowledge management” program nor of its bio-energy assessment. 6 The Office of the U.S. Trade Representative review of trade barriers to products that it claims reduce the intensity of greenhouse gas emissions is concerned with patents only to ensure the enforcement of U.S.-granted patents in traded products.7 Patents are left out of the equation when, in fact, they should be one of the most central components for consideration.


Footnotes:
  1. “Debate Rages Over Benefits and Drawbacks of Biofuels.” Bridges Trade BioRes. Vol. 6. No. 18 October 6, 2006 and Grant Aldonas. “A Fresh Free Trade Agenda for Doha.” Financial Times. July 13, 2007.
  2. “The Global Bioenergy Partnership.” Press release. May 2006. http://www.globalbioenergy.org
  3. “Challenges and opportunities for developing countries in producing biofuels.” United Nations Conference on Trade and Development. UNCTAD/DITC/ COM/2006/15. November 27, 2006. 11.
  4. Ibid. 12.
  5. Renewable Fuels Association. “Annual World Ethanol Production by Country.” Accessed October 10, 2007. http://www.ethanolrfa.org/industry/statistics/#E
  6. “Introducing the International Bioenergy Platform.” Food and Agricultural Organization of the United Nations. 2006.
  7. “Report by the Office of the United States Trade Representative on Trade-Related Barriers to the Export of Greenhouse Gas Intensity Reducing Technologies.” October 2, 2006. http://www.ustr.gov


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