April 4, 2014

"Flex" Sugar Mills in Brazil Produce 35 Million Liters of Ethanol

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

With a surplus of corn in the state, farmers in Mato Grosso are glad to hear that a little of that corn is now being used to produce ethanol. Two "flex fuel" sugar/ethanol mills in the state are now using corn or grain sorghum to produce ethanol when sugarcane is not available.

In Brazil, the sugarcane harvest generally ends in December and resumes in March after the heavy summer rains have ended. The wet summer weather keeps the mechanical harvesters out of the fields and it also results in less sucrose content in the sugarcane. During the shutdown these mills would normally conduct annual maintenance, but more likely set idle for up to four months. The two "flex fuel" mills in the state have been retrofitted to utilize corn or grain sorghum during this period to keep the mill operating year round.

As a result, these two mills will produce 35 million liters of ethanol in 2013/14 by utilizing approximately 80,000 tons of corn and/or grain sorghum. While this is a tiny fraction of the over 22 million tons of corn that was produced in the state in 2013/14, it is one small way to increase the domestic consumption in the state instead of having to transport the corn to other regions of Brazil at very high transportation costs.

In September of 2013, the Mato Grosso Soybean and Corn Producers Association (Aprosoja) sponsored a meeting in Sinop, Mato Grosso where data was presented indicating that one ton of corn could be transformed into 380-400 liters of ethanol, 18 liters of degummed corn oil and 220 kilograms of DDG (dry distillers grain) generating an income of R$700 compared to an income of R$ 200 if the corn was sold as grain alone.

Other sugar mill operators in Brazil have taken notice of the "flex fuel" facilities and several have already indicated that they will retrofit their mills as well. On an even larger scale, the American company POET has formed a joint venture with the Brazilian company BioUrja Trading LLC to build four corn-only ethanol plants in the neighboring state of Mato Grosso do Sul. Their first facility will initially utilize 350,000 tons of corn annually in the production of 50 million liters of ethanol. POET is responsible for approximately 10% of the ethanol produced in the United States.