Brazil's Ethanol Industry: Looking Forward: A Report from the Economic Research Service
Brazil is a major supplier of ethanol to the world market, the result of its natural advantage in producing sugarcane, productivity increases, and policies stimulating the supply of feedstock and of sugar-based ethanol. Global demand for ethanol and other biobased fuels is expected to grow in response to mandates for increased use of renewable fuels around the world. Brazil will be well positioned to fi ll the growing world demand for ethanol. However, Brazil’s ability to supply the export market depends on its domestic ethanol use mandate, world sugar and oil prices, the currency exchange rate, and the infrastructure to move ethanol to ports. Brazil is challenged with sustaining production growth in the ethanol sector so as to meet increasing domestic demand and, at the same time, maintain its position as a major supplier of ethanol to world markets that are growing rapidly in response to their own ambitious targets for renewable energy use.