Indonesia bought US$ 877 million in Brazilian sugar and now threatens national agricultural exports with a plan to cut imports, expand local production, and convert sugarcane into bioethanol by 2028.

Written by Alisson Ficher

Published on 31/05/2026 at 15:50

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Indonesian market continues buying Brazilian sugar in significant volumes, but the combination of smaller quotas, local production, and bioethanol places the national agribusiness in a more competitive scenario in Southeast Asia.

Indonesia reduced authorization for external purchases of raw sugar in 2026 and reinforced a self-sufficiency policy that could reshape part of the trade with Brazil, one of its relevant suppliers in the sugar-alcohol chain.

The movement combines still significant imports, stimulation of local production, and use of sugarcane in bioethanol, in a strategy that brings together food security and energy.

The signal worries Brazilian exporters because the Asian country imported US$ 877.21 million in sugars and confectionery products from Brazil in 2025, according to Comtrade data compiled by Trading Economics.

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Indonesia’s import licenses reduce space for Brazilian sugar

S&P Global Commodity Insights reported that Indonesia issued import licenses for raw sugar totaling 3.1 million tons for 2026.

The volume was below the 3.45 million tons authorized in 2025 and was associated by market sources with a combination of weaker demand and advancement of domestic production.

The reduction does not represent an interruption of external purchases, nor a blockade on Brazilian sugar.

Even so, it changes the predictability for mills, trading companies, and logistics operators, because large-scale buyers influence prices, shipments, premiums, and contracts even before any effective drop in deliveries.

In practice, the Indonesian government tries to better control the import flow without giving up industrial supply.

Refineries and food and beverage manufacturers depend on imported raw sugar to maintain production, which makes quotas a central instrument of the supply policy.

S&P Global also noted that ships were already carrying sugar to Indonesia, including the Jin Ping, a Supramax loaded in Santos on January 27 and destined for Cigading.

The data shows how decisions made in Jakarta directly impact Brazilian logistics, from the origin at the mills to the export ports.

Local sugar production gains weight in Jakarta’s strategy

The adjustment in licenses occurs amid a broader agenda of reducing external dependence.

S&P Global itself points out that Indonesia was the second-largest sugar importer in the world, behind China, and that its purchases fell from a peak of 6 million tons in 2022 to 5.31 million tons in 2024.

This decline helps explain why the market closely follows each decision on quotas.

Even when the country continues to buy large volumes, any cut signals less room for foreign suppliers and increases the competition between Brazil, Thailand, India, Australia, and other exporters.

Indonesia seeks to expand national production to reduce exposure to price and supply shocks.

Sugar is treated as a strategic product as it meets household consumption, supplies the food industry, and serves as a base for new energy chains.

For Brazil, the risk is not in an immediate loss of market, but in the gradual change of priority of an important buyer.

When a populous country with strong industrial demand plans to reduce external dependence, exporters need to recalibrate sales and shipping expectations.

Bioethanol expands the dispute over the use of sugarcane

The pressure on sugar trade becomes more complex because sugarcane also appears in Indonesia’s bioethanol plan.

In February 2026, Reuters reported that the government intends to increase the mandatory bioethanol blend in gasoline to 10% by 2028, after delaying the schedule due to supply limitations.

According to the agency, Indonesian authorities stated that the goal is to reduce gasoline imports and increase energy self-sufficiency.

The policy foresees the use of biofuels produced from raw materials such as palm oil and sugarcane, in addition to improvements in infrastructure and diversification of inputs.

This design creates an internal dispute over the agricultural use of sugarcane.

Part of the raw material can be directed to sugar for consumption and industry, while another part can supply bioethanol, if the country manages to expand planted area, processing, and fuel distribution.

Reuters also reported that Indonesia did not reach the 5% blend target in 2025 due to insufficient ethanol supply.

By 2028, the government projects the production of 0.80 million kiloliters of bioethanol, against a national gasoline demand estimated at 39.9 million kiloliters.

Impacts for Brazilian Plants and Exporters

In the Brazilian sugar-energy sector, external decisions of this magnitude come into focus because plants adjust each harvest the proportion of cane destined for sugar or ethanol production.

Changes in major buyers do not solely determine this choice, but they affect international prices and the outlook on future demand.

Brazil maintains significant advantages, such as production scale, export experience, and logistical integration with high-traffic ports.

Even so, markets with smaller quotas, domestic production targets, and more nationalized energy policies make international sales less automatic.

Indonesia continues to need imported sugar for its industry, and S&P Global CERA projects imports of about 4 million tons of raw sugar in 2026.

The same projection indicates domestic consumption of 7.56 million tons, which confirms the market size but also reinforces the importance of monitoring the reduction of licenses.

The alert, therefore, is in the set of measures, not in an isolated decision.

Fewer licenses, encouragement of local production, and the use of cane in bioethanol form a strategy that can alter, over the coming years, the space occupied by Brazilian sugar in Southeast Asia.

Indonesia bought US$ 877 million in Brazilian sugar and now threatens national agricultural exports with a plan to cut imports, expand local production, and convert sugarcane into bioethanol by 2028.

Indonesian market continues buying Brazilian sugar in significant volumes, but the combination of smaller quotas, local production, and bioethanol places the national agribusiness in a more competitive scenario in Southeast Asia.

Indonesia’s import licenses reduce space for Brazilian sugar

Local sugar production gains weight in Jakarta’s strategy

Bioethanol expands the dispute over the use of sugarcane

Impacts for Brazilian Plants and Exporters

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Indonesia bought US$ 877 million in Brazilian sugar and now threatens national agricultural exports with a plan to cut imports, expand local production, and convert sugarcane into bioethanol by 2028.

Indonesian market continues buying Brazilian sugar in significant volumes, but the combination of smaller quotas, local production, and bioethanol places the national agribusiness in a more competitive scenario in Southeast Asia.

Indonesia’s import licenses reduce space for Brazilian sugar

Local sugar production gains weight in Jakarta’s strategy

Bioethanol expands the dispute over the use of sugarcane

Impacts for Brazilian Plants and Exporters

A giant printer called the “Ferrari” of concrete has landed in Latin America and can already build a 120-square-meter house in just 48 hours, making the traditional construction site look like something from the last century.

Great Atlantic Sargassum Belt has ceased to be a climatic phenomenon and has become a biological system that feeds on itself, with 8,000 kilometers in length, 37 million tons of algae, and scientists confirm that it is now permanent.

A British company has installed in the middle of the ocean the world’s first floating platform that generates electricity 24 hours a day from the temperature difference between the surface and the depths of the Atlantic, without relying on wind or sun.

Brazil will harvest a record crop of up to 357 million tons of grains, but it does not have the capacity to store a large part of it. The storage deficit has reached the highest level in history and is equivalent to almost the entire production of Argentina.

Engineers had to pour concrete mixed with tons of ice throughout entire nights in the Dubai desert to erect the Burj Khalifa; any carelessness could clog the pipes half a mile high.

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