Bloomberg’s ‘Deadly Brew’ Report Infuriates Brazil’s Sugarcane Industry

Presidents Bush and Lula look at sugarcane For UNICA, the Brazilian Sugarcane Industry Association, a report aired on Bloomberg Television on January 24 called "Deadly Brew" is a misleading piece and an out-of-context representation of today's Brazilian sugar and ethanol industry.

Marcos Jank, UNICA's president and CEO lambasted the TV presentation: "The report relies on isolated incidents, flawed data and unsubstantiated allegations. Not surprisingly, it arrives at unbalanced and inappropriate conclusions that bear no resemblance to the industry as it is today."

The report is seriously out-of-date according to Jank, as it not only omits wide-ranging advances in labor conditions and relations between workers and employers, but also chooses to portray industry efforts to introduce mechanization and end the manual harvest in a gradual and orderly manner as a problem and not a solution. At the same time, the report strives to criticize the manual harvest itself.

"Bloomberg appears more interested in showing impressive footage of a fire burning in the night than explaining that this is how straw is cleared virtually wherever sugarcane is harvested in the world," says Jank.

The fact that close to 40% of the Brazilian harvest is already mechanized is not even mentioned, says UNICA, while signed agreements between the industry and labor unions that have brought significant improvements to worker transportation, transparency in payment methods and protective equipment standards were equally ignored.

And while nobody in the industry will argue that problems still exist, the organization says, they must be put in the right context, something the Bloomberg report fails to do as it focuses on examples far removed from the accepted norm in the Brazilian sugar and ethanol industry, in a clear attempt to imply that exceptions reflect the entire industry.

The Brazilian Sugarcane Industry Association represents the top producers of sugar and ethanol in the country's South-Central region, especially the state of São Paulo, which accounts for 60% of the country's total production.

Along with its 101 member companies, UNICA develops position papers, statistics and specific research in support of Brazil's sugar, ethanol and bioelectricity sectors. Its membership accounts for about 50% of Brazil's sugarcane harvest.

According to UNICA, in 2007, Brazil produced 425 million metric tons of sugarcane, which yielded 29.8 million tons of sugar and 17.7 billion liters of ethanol.

UNICA presents a list of what they call misrepresentations in the Bloomberg report:

"The completely unsubstantiated statement that conditions have
deteriorated while ethanol has expanded. For example, close to 95% of all field workers involved with UNICA member companies are documented workers, with labor and social security benefits, which puts the sector ahead of nearly all others in the Brazilian economy in that respect. On average, workers are paid about double the current Brazilian minimum wage, which places them among the best paid in Brazilian agriculture;

"The report portrays all cane cutters as migrant workers from lower income regions in the country, which is not the case anywhere in Brazil. Most cane cutters are from the area where they work;

"There are close to one million workers in the industry throughout Brazil, not 500,000 as the report says. About 400,000 are cane cutters. In the state of São Paulo, the heart of the industry and base of UNICA's membership, there are 189,000 cane cutters, of whom 40% are migrant workers from other states;

"There is no minimum amount a cane cutter must produce per day. Cutters are guaranteed a minimum daily fee regardless of how much they cut, and the final amount paid to each cutter is based on a pre-negotiated amount per ton;

"Numbers without context may sound impressive in political campaigns but don't amount to credible journalism, and are often used to distort viewers' impressions. The report mentions accident numbers that appear high but are outdated, and doesn't refer to the latest Labor Ministry statistics showing accidents in the sugar and ethanol industry falling from 11,000 in 1999 to 8,000 in 2005, even as the number of workers has grown;

The report also mentions an outdated death total, ignoring the latest available Labor Ministry figures, which show that in 2005, 17 workers died on the job or while being transported to their work locations. That represents 0.004% of 414,000 cane cutters throughout Brazil;

"It should be noted that contrary to what the Bloomberg report implies on several occasions, there is not a single case where the death of a field worker from the sugar and ethanol sector in Brazil has been officially linked to the type of work done;

"There is no provision in the Brazil-U.S. Ethanol agreement signed in 2007 that "ensures Brazil will be a major beneficiary" of ethanol exports to the United States. Not only is there no such clause or guarantee in that document, as stated in the Bloomberg report, but current import tariffs in the U.S. strongly discourage importing ethanol from Brazil;

"There is no such thing as a "razor-sharp stalk" as mentioned in the report – what's razor-sharp is the straw that's burned so cutters can begin the harvest. In fact, burning the straw is called for in collective agreements between workers and employers. If the straw isn't cleared, the cutter cannot do the job.

UNICA goes on to say:

"The Brazilian Sugarcane Industry finds it unacceptable that a global organization like Bloomberg, established in Brazil for several years with a large team of journalists, chose to produce such a distorted view of a highly successful sector of the Brazilian economy, which Bloomberg professionals cover and do business with on a daily basis.

"There is no reasonable explanation for phrases like 'cars run on human blood' or 'Brazil entering its industrial revolution' finding their way into a report produced by Bloomberg, leaving the impression that its professionals are not aware of what goes on in Brazil, including its current stage of industrialization.

"In fact, Bloomberg professionals cover Brazil every day, and routinely file stories that clash directly and quite blatantly with much of what's in the 'Deadly Brew' report," Jank concludes.

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