Transition and recovery. These words
show up at every moment in Brazil’s sug-
arcane sector, when an analysis is conduct-
ed on the 2015 and 2016 growing seasons,
along with the expectation for a future con-
firmation. Positive and negative points are
an integral part of the evaluations, to reach
the conclusion that an improvement pro-
cess is underway, after a period of severe
crises. Everybody’s objective is for this re-
ality to move ahead, with durable situations
and regulations, side by side with much
needed internal adjustments.
In 2015, positive alterations occurred in
themarkets of sugarcane, sugar and ethanol,
by virtue of the better prices fetched by this
food item, with smaller production volumes
and favorable exchange rate, and soaring
demand for this biofuel, based on support-
ive measures. Weather condi-
tions were still favorable, there
were environmental and en-
ergy gains, by virtue of a pro-
tocol existing in this area, An-
dré Rocha recalls. Rocha is the
president of the Sugar-Energy
National Forum, without over-
looking, of course, the high-
er costs and the downturn of
Brazilian economy.
This economic downturn
in the Country did not pre-
vent the supply chain from
earning 5% more, compared
to 2014. The value ascertained
by the Center for Applied
Studies on Advanced Econom-
ics (Cepea), linked to the Luiz
de Queiroz College of Agricul-
ture (Esalq), of the Universi-
ty of São Paulo (USP), reaches
R$ 113.27 billion, taking into
consideration inputs, primary
activities, industries and services. It is one of
the biggest players in Brazilian agribusiness,
it even outstrips soybean and only comes
second to beef cattle farming, in five supply
chains that were analyzed.
The result, according to the evaluation
by Eduardo Leão de Sousa, chief executive
director of the Brazilian Sugarcane Indus-
try Association (Unica), in June 2016, trans-
lates the exuberance of the sugarcane sector
in our national agriculture, even in a rath-
er complicated sectoral scenario, with many
mills grappling with financial crunches, and
a national scenario aggravated by the eco-
nomic downturn and by the lack of confi-
dence”. That is why, there was still “no vig-
orous turning point in sight and nothing
sustainable about expectations”.
Anyway, according to another study,
conducted by the Technical Superinten-
dence of the Brazilian Confederation of
Agriculture and Livestock (CNA) and the
Program for Continuous Education in
Economics and Business Management
(Pecege), from the Luiz de Queiroz Col-
lege of Agriculture (Esalq), of April 2016,
“the present scenario points to a slight
improvement”, with “recovery under-
way”. In spite of the soaring production
costs, he sees a reduction in this rhythm
and better prices for the products. In the
recovery process, he strengthens the role
of agricultural productivity, co-genera-
tion of energy and control of costs. He
hopes that, in the short run, the activity
will be in a position to recover its remu-
neration capacity, although heavy debts
are still a hurdle for any investments.
For recovery to sustain it-
self, leaderships of the sector
maintain that there is need for
strong private and public en-
deavor, and durable rules for
the activity. What is also men-
tioned is the fight against pro-
tectionism and false myths
relative to sugar and, particu-
larly, the definition of perma-
nent guidelines for the ener-
gy matrix, making it possible
to broaden the space for bio-
energy, whilst acknowledg-
ing environmental, social and
sanitary advantages. Accord-
ing to Antonio de Padua Ro-
drigues, technical director at
Unica, there is need for again
establishing a positive envi-
ronment, like the one that led
to the huge leap of the sector
in the past decade, but with-
out suffering any interruption.
Light on the horizon
Brazilian sugar-energy sector seeks a stable improvement affirmation after
years of crises and indebtedness, with a sustainable environment for the future
Relevant supply chain
brought in revenue of
R$ 113 billion in 20153
Sílvio Ávila
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