Brazil Anticipates Sugar Cane Harvest by 2 Months to Contain Ethanol Prices

Brazilian drivers, many of them behind the wheel of newly popular hybrid models (known as "flex-fuel" or just "flex," which can run on gasoline with an ethanol additive or pure ethanol) have not been hit hard by US$ 60-plus barrels of petroleum precisely because the country has its sugarcane-based ethanol alternative fuel.

But recently the growing cycle stepped into the picture and messed things up slightly.

With the next sugarcane harvest scheduled to begin in May, and the last harvest long over, there was a shortfall in the ethanol supply that began to have a negative effect on prices at the pump at the end of last year.

In January the government made a quick deal with the sugarcane growers and sugar mill owners (usineiros) to hold prices stable. But market forces sank that agreement quickly.

Now the usineiros association in the state of São Paulo (União da Agroindústria dos Canavieiros de São Paulo) (Unica) has agreed to anticipate their harvest.

The official opening of the harvest will take place in the city of São Tomé, state of Paraná, next Wednesday. That is Ash Wednesday, conveniently after Carnaval.

Unica says its decision to anticipate the harvest "will increase the supply of ethanol on the market." And that is what everybody wants.

Agência Brasil

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