The Sustainability of Sugarcane Ethanol in Brazil: Perspective and Challenges

Abstract

The chapter proposes to illustrate the challenges, concerns, and perspectives of ethanol production in Brazil. First, to give an overall of the sugarcane production and market conjecture, taking into account issues such as the public policies to promote biofuels improvement as well as those applied to energy markets and their connection (implications) with (into) sugar-ethanol market. Then, we propose the discussion of the challenges derived from sugarcane expansion from a sustainability perspective, as the environmental impacts, land use change and their impacts on crop productions and regional socioeconomics indicators, and the risk management strategies and tradeoffs between sugar-ethanol and second-generation ethanol-electricity cogeneration. Lastly, we bring a debate over the concerns and perspectives that are related to the development of this market, pointing out institutional risks that can affect strategies and competition in the production chain, such as policies to energy production, taxes changes, the increase in corn and sugarcane second generation ethanol production, and international trade agreements. Overall, there is an understanding that Brazilian ethanol production is following sustainable patterns. Currently, major challenges are related to the improvement of risk management strategies, as well as to create a more predictable scenario on the direction of public policies to the energy market.