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Brazil Raises Sugar Cane Production 15% to Make Ethanol

Sugar cane plantation in Brazil Brazil should harvest 547 million tons of sugar cane by March 2008, the equivalent of a 15.2% increase over the previous crop, as announced by the president at the National Food Supply Company (Conab), Wagner Rossi. Based on the second field survey, conducted by Conab technicians in power plants and sector organizations, from the 06th to the 17th this month, he stated that 473 million tons (86.47% of the total) are going to be destined for sugar and alcohol production.

The remainder will be used in the manufacturing of cachaça (typical Brazilian cane spirit), rapadura (solid brown sugar sold in the shape of a brick), animal feed, and seeds.

According to Wagner Rossi, the technicians at the plants aim to maintain the same levels of sugar production, at around 30 million tons, or even to reduce it slightly, at around 0.6%, due to the "low market price for the commodity," as costs have decreased by nearly 40% last year.

He said that, on the other hand, alcohol production should increase from 17.471 billion liters, in the last crop, to 21.298 billion liters. This equals a 21.9% increment, "driven mostly by the great demand for alcohol in the domestic and foreign markets."

The survey, conducted at 346 plants and distilleries, as well as 60 sector organization in the sugar and alcohol industry, came to the conclusion that the cultivated area for sugar cane grew by 12.3%, rising from 6.2 million hectares, in the last crop, to 6.9 million hectares in the current one.

There has been an expansion in all regions of the country, but the growth was more pronounced in the states of São Paulo (Southeast), Minas Gerais (Southeast), Mato Grosso (Midwest), Mato Grosso do Sul (Midwest), Goiás (Midwest) and Paraná (South), which concentrate 82.27% of the country's total sugar cane production.

ABr

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  • Show Comments (4)

  • DANIEL D MARTIN

    ETHANOL ADVANTAGES
    We got E85 station in Miami,South Florida and E10 mandate may be posible in different states(so far in Minnesotta and Hawaii) That is going ti increase demand in USA,wich could benefit the Brazilean exporter and American consumers as gas prices keep skyrocketing.
    Way better deal to import Brazilean or Latin American ethanol than ever more expensive Venezuelan,Nigerian or Arabic oil!

  • conceicao

    I really would like to see some kind of explanation. The only substantial outlet for domestic over-supply that I know of is exports to the U.S. despite the tariff.

  • Ric

    I DonÀ‚´t Get This
    Conversation at all. From what I read the percentage of alcohol in regular gasoline was raised to 25% from 23% last month precisely because there was an oversupply of alcohol at the point of prodution which had caused the wholesale price to fall by 30%.

    How does that fit with this article?

  • conceicao

    The statistics – 20-plus % increase in alcohol output – suggest to me that ethanol exports to the U.S. are ramping despite the tariff. It is possible that Brasilian production has such a cost advantage and transport is so much more convenient from Brasilian production facilities than from the U.S. Midwest to the Gulf refineries that Brasil is taking market share in the U.S. despite the tariff. If so, the tariff / tax credit /
    federal mandate regime that the emprendedores politicos Norte Americano (sic) have erected to feed off of would be revealed as little more in substance than a tax manipulation designed to line the
    pockets of the favorably situated. If Brasilian producers are taking share despite the tariff, that has to be the end for the tariff.

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