Portuguese 
English 
Spanish 
5 min of reading 
0 comments 
With ethanol in the spotlight after the surge in oil prices and the risk of insecurity in international routes, Brazil is once again seen as a strategic supplier of biofuels, but still depends on trade agreements and public policies to accelerate exports
The rise in oil prices in the international market, driven by tensions in the Middle East, has rekindled global interest in energy alternatives and placed Brazilian ethanol back at the center of discussion. With a matrix considered cleaner and a consolidated production capacity, Brazil can gain ground as a strategic supplier of biofuels at a time of uncertainty for countries dependent on imports.
However, the scenario is not automatic. The reading presented is that there is a legal basis and production capacity to meet an increase in demand, but practical advancement depends on rules, negotiations, and trade agreements. Countries like the United States, South Korea, and the Netherlands are already appearing as interested parties, while others, such as India and Mexico, are observing the Brazilian biofuel model to reduce global impacts of the war.
What is driving the shift: higher oil prices, instability, and the search for alternatives
The pressure starts with price and supply. The assessment is that the volatility of oil, combined with insecurity in export and import contracts and routes, forces countries to seek measures to mitigate impacts and ensure energy for their internal markets.
-
Carrefour will close its doors in Brazil in the coming days: a store in a prime area of 90,000 m² will close on April 30 to make way for a million-dollar luxury real estate megaproject in Curitiba.
-
War in the Middle East causes oil to rise 50% and surpass $100, accelerates the race for electric cars in Asia, and boosts sales of BYD and VinFast, while consultancy projects up to 80 million new EVs worldwide by 2030.
-
The giant furniture company from Santa Catarina puts real estate and machines worth R$ 7 million up for auction after a debt of nearly R$ 36 million and judicial recovery, in an attempt to generate immediate cash, maintain production in Campo Alegre, and reorganize operations in the West of SC.
-
A chartered twin-engine plane from Prosegur crashes in Minga Guazú, near Ciudad del Este, carrying US$ 5 million and R$ 15 million; within 15 minutes, locals loot the site and police investigate reports of the disappearance of at least US$ 1.5 million after the accident.
In this context, alternatives like ethanol gain more weight, as they serve as a partial substitute and can reduce dependence on imported fossil fuels, especially for economies that quickly feel any disruption in supply.
Why Brazilian ethanol is back at the center of the global market
Brazil is cited as the second-largest producer of ethanol in the world and, therefore, has the capacity to meet global demand for this biofuel. The reading presented is that the country already sustains internal consumption and still has room for external supply.
In addition to scale, Brazilian ethanol appears with a competitive advantage in the international environmental and regulatory debate. The argument is that policies like Renova Bio reinforce Brazil’s position, especially in light of environmental requirements from Europe and other countries.
The obstacles that could hinder progress: trade agreements and public policies
The main bottleneck identified is not the existence of the product, but the construction of conditions to expand exports. Among the legal barriers mentioned are public policies and, mainly, the need for trade agreements between governments to release and facilitate the flow of ethanol to interested countries.
There is mention that there is already a trade agreement with the United States in this regard, which would serve as a reference for new negotiations. The step considered decisive would be to advance in bilateral and commercial agreements with other federations so that exports gain scale.
Renova Bio and the historical advantage: large-scale production since 1975
The presented basis relates the growth of the sector to the fact that Brazil began large-scale production of biofuel in 1975 and incorporated ethanol into the fuels used in vehicles. From then on, the industry would have expanded continuously until reaching the current level.
The interpretation is that this helps both production and export, by combining experience, structure, and an internal market that already operates with ethanol as part of the fuel matrix.
Conflicts and protectionism: risk exists when the market becomes more contested
The risk of trade conflicts and protectionism is treated as a factor always present when discussing trade and money. The assessment presented is that, despite this risk, Brazil would be a central target for foreign countries that would need biofuel to minimize global impacts of the war.
An example cited in the conversation illustrates the difference in pressure: while the cost of oil would have risen 30% in the United States, in Brazil it would have risen 5%, in an effect associated with mass production and the presence of ethanol in mixtures with gasoline.
What changes in practice in Brazil: exports may grow and pressure internal prices
With more external demand, the indicated trend is twofold: growth in exports and indirect impact on internal prices. The reading presented is that the increase may be predictable for both fuels and food, as many costs depend on oil and transportation.
At the same time, external expansion may increase the need for production, which places the sugar-energy chain at the center of the strategy and amplifies the importance of regulatory and commercial predictability to sustain contracts and investments.
Opportunity for the rural producer: more sugarcane, more demand, and space at the end
For the rural producer at the forefront, the scenario is described as a real opportunity, especially if new trade agreements are finalized. The assessment is that, with exports on the rise, Brazil would need to produce a larger quantity of sugarcane, and this opens up space for the producer’s growth.
The logic presented is straightforward: without production, there is no ethanol and no exports. If global interest turns into contracts and agreements, demand can translate into production expansion and income improvement along the chain.
The next steps: Europe on the radar and bilateral agreements under negotiation
There is indication of space for new bilateral and trade agreements, citing potential interest from South Korea and the Netherlands, countries described as dependent on fuel and affected by issues on the route referred to as Straight of Orbus.
The conversation also mentions President Lula’s trip to Europe and a statement in defense of biofuels as an alternative to fossil fuels, pointing out that this positioning may signal Brazil’s interest in advancing agreements to help European countries reduce energy costs.
In your view, will the rise in oil truly transform Brazilian ethanol into a global protagonist and generate real gains for the rural producer, or can trade barriers and protectionism still hinder this race?
Seja o primeiro a reagir!