NASHVILLE, TN – Brazil’s growing ethanol industry could reshape global grain competition as the country increases domestic corn use while expanding renewable fuel demand.
Leticia Correa with StoneX Brazil says the 2026-27 Center-South crop started with mills favoring ethanol over sugar because of weaker international sugar prices, and that sugar is one of Brazil’s largest crops. Ethanol production is projected to rise 12 percent this season, with hydrous ethanol production increasing 16 percent.
The biggest shift is corn ethanol. Brazil’s corn ethanol production is projected to reach 11 billion liters, representing about 30 percent of the country’s total ethanol output. Corn ethanol production costs are estimated to be 20 to 30 percent lower than those for sugarcane ethanol, and plants can operate year-round.
Lower prices are also supporting demand. Ethanol values have fallen 23 percent since April, improving competitiveness against gasoline. Brazil is also considering increasing its required ethanol blend in gasoline from 30 percent to 32 percent, potentially adding about 500,000 cubic meters, or 132 million gallons, of demand.
U.S. ethanol groups continue to raise concerns about Brazil’s trade restrictions, but Brazil’s domestic growth may create a longer-term shift in global corn and biofuel markets.
Farm-Level Takeaway: Brazil’s ethanol expansion could increase domestic corn demand inside one of America’s largest grain export competitors.