Farmdoc daily reports that Brazil’s rapid expansion of corn-based ethanol production is transforming the country’s domestic corn market, sharply boosting internal consumption and potentially curbing future exports. Takeaways:
· Record corn use for ethanol: Brazil’s corn ethanol production has surged from 16 million bu. in 2015-16 to 722 million bu. in 2024-25 — 15% of national output. The country now has 25 operational corn ethanol plants with 15 more under construction.
· Domestic consumption soars: Total corn consumption has jumped 53% in the past decade to 3.5 billion bu., with 2.5 billion bu. going to animal protein and 925 million to food, seed and industrial uses – including ethanol.
· Export impacts: Corn exports are projected to fall 20% from their 2023 peak, partly due to China’s declining demand and increased output from the U.S., Argentina and Ukraine.
· Price surge: Domestic corn prices hit a 3-year high in March, topping 37 reais ($6.57) per bushel in Paranaguá.
· Policy & market shifts: Ethanol demand is rising with Brazil possibly raising its gasoline ethanol blend from 27% to 30%. Flex-fuel vehicles and new plants will likely sustain demand growth.
Global implications: Brazil’s booming ethanol sector, powered by second-crop corn (safrinha), is expected to tighten export availability, easing competitive pressure on U.S. corn in global markets and supporting international prices.
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