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Global Environment

¿Brazil, qué tal?

Does ethanol production sap resources necessary for world-wide food production? Brazil doesn’t think so. The Inter-American Development Bank agreed with them in extending a $269M loan to ethanol producer Cia. Nacional de Açúcar & Álcool, a Brazilian firm specializing in ethanol production from sugar cane.

As opposed to ethanol production from corn, which is predominantly what the US does, conversion of sugar cane into ethanol is a more efficient process. More importantly, perhaps, is the fact that as food inflation worldwide has been on the rise over the past year, with corn leading that list, sugar prices are one of the few food staples decreasing during that time.

With only 1% of their country’s arable land going towards ethanol production, the country has the capacity to expand their production using sugar cane. This loan will go towards constructing a new ethanol plant, each of which cost around $300M. An added bonus is that waste byproducts from operations can be converted to biodiesel and combusted to provide electricity for roughly 400,000 local homes.

And they have Giselle. Nice work.