Production of Ethanol from Sugarcane in Brazil

Volume 43 of the series Natural Resource Management and Policy pp 75-80


The Marketing of Sugarcane and Ethanol: Changes Resulting from Deregulation

  • Márcia Azanha Ferraz Dias de MoraesAffiliated withLuiz de Queiroz College of Agriculture (ESALQ) Economics, Business and Sociology Department, University of São Paulo Email author 
  • , David ZilbermanAffiliated withAgricultural and Resource Economics, University of California

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The change in the institutional environment, initiated by Directive no. 94 and later supplemented by Directive no. 294, also caused considerable concern not only among the owners of sugar mills and ethanol plants but also among the sugarcane suppliers, who had until then traded sugarcane on the basis of the official prices dictated by the government (through the Executive Office for Regional Development). The lifting of price controls on anhydrous ethanol, hydrous ethanol, and sugarcane (scheduled for May of 1998) called for a new form of remuneration for sugarcane to take the place of the previous system of prices tabulated by the government. The new system would have to meet the needs of sugarcane suppliers, sugar mills, and ethanol plants. One entity that played a major role in this process was the Conselho dos Produtores de Cana-de-Açúcar, Açúcar e Álcool do Estado de São Paulo (CONSECANA-SP, São Paulo State Council of Sugarcane, Sugar, and Ethanol Producers).