Brazilian biodiesel producer BSBios on Tuesday started constructing the country's first biodiesel plant, which is expected to produce fuel from vegetable oils and reduce diesel fuel imports.

To be located in Passo Fundo, in the Rio Grande do Sul state, the plant will be able to produce 100 million liters of biodiesel annually when it starts production in 2007, said Minister of Rural Development Guilherme Cassel.

Using soy, canola and sunflower seeds to produce biodiesel, the plant will process around 90 tons of grains per year. It is expected to create over 1,100 jobs and around 4,100 families who produce grains in 100 towns near Passo Fundo will be benefited, said Cassel.

BSBios invested 40.9 million reais (17.7 million U.S. dollars) in the project. The company's commercial director Erasmo Carlos Battistella said the plant is near major fuel distributors, who are future possible clients.

The project also received the Social Fuel Stamp from Brazil's Ministry of Rural Development, enabling it to buy cheaper raw materials from local producers.

Source: Xinhua