Thursday, August 28, 2008

Tequila endangered by switch to biofuels

Tequila could become a thing of the past as Mexico appears to be turning its back on the cactus-like plant from which the country's national tipple is made, in favour of more profitable crops.

America's increasing demand for ethanol has caused global commodity prices to spiral upwards and encouraged farmers of blue agave, the origin of tequila, to switch to more profitable cash crops, such as wheat and corn.

Mexican farmer  harvests agave for making tequila
Mexican farmer harvests agave for making tequila

Mexican farmer harvesting agave which is used to make tequila

Corn currently sells for a record 18 cents a pound as US motorists turn towards biofuels in an attempt to avoid the soaring cost of petrol - now $2 a gallon.

In contrast, agave, which was worth approximately 80 cents a pound six years ago, now sells for less than two cents.

As a result, farmers have taken the difficult decision to let their agave crops burn to clear the way for more lucrative crops.

One farmer, Miguel Ramirez, told USA Today: "I'm going to get out of agave completely. Corn is where the money is now."

Mexican officials say farmers planted up to 35 per cent less agave in 2007 and expect the trend to continue this year.

Agave takes six years to grow and therefore any shortage in supply cannot be properly filled when the realisation takes hold.

Raudel Lopez Sandoval, a Mexican farmer, said the boom-and-bust nature of the tequila industry was a problem.

Speaking to USA Today, he said: "You tend agave for six years, and then the price drops on you or you get hit with a freeze or something.

It's a lot of investment to lose whereas beans grow fast."

Original here

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