They argue that deriving ethanol from crops such as corn would take valuable arable land, increase food prices and further impoverish the poor.
Mr Chavez and his Brazilian counterpart were seen at odds over the amount of ethanol output in developing countries – understandably, given the differences in their existing energy stances on biofuels.
Whereas Brazil has been a world leader in the use of ethanol made from sugar cane for the last thirty years, Venezuela is the fifth-largest crude oil exporter in the world and the only member of oil cartel Opec.
Mr Chavez is also arguing for an alliance between Latin American states to compete with oil cartel Opec to promote 'a fair price' for natural gas.
He is expected to reveal plans for a 5000-mile natural gas pipeline between Venezuela and Colombia.
Leaders from Argentina, Brazil, Bolivia, Chile, Colombia, Ecuador, Paraguay and Bolivia are attending the summit.
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