"In the near future, petroleum will not be the reason for war, or for an oil-consuming country to invade an oil producer," Lula said as he opened the Soyminas plant in the southeastern state of Minas Gerais.

"We are showing the world that it is possible to create a fuel from renewable resources," he said.

The Soymina plant will produce up to 12 million liters (3.2 million gallons) per year of biodiesel fuel from oleaginous seeds like sunflower, soybean, and castor bean.

The biodiesel will be blended at a 2% ratio with gas oil, permitting its use in diesel vehicles without modification.

Brazil is one of the world's most advanced producers of alternative fuels made from farm crops. Gasoline sold around the country includes a 22% blend of ethanol produced from sugar cane.

On March 15, Neiva Aeronautic Industry, a subsidiary of aircraft manufacturer Embraer, launched the world's first production-series model aircraft that runs on ethanol. The plane -- a single engine, single seat EMB 202 Ipanema -- is widely used in agriculture.

Additionally, since 2003, the country has seen a big growth in "flex-fuel" automobiles with engines that can run equally well on gasoline and ethanol.

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