Brazil introduces sugarcane restrictions

By Kris Bevill | October 06, 2009
On Sept. 17, Brazil President Luiz Incio Lula da Silva proposed a bill that, if passed, will greatly restrict land available for sugarcane farming and processing in the world's largest sugarcane-producing country. Promoted as an "unprecedented initiative," the bill would effectively make 92.5 percent of Brazilian land off-limits to the sugarcane industry. The bill was drafted in response to findings from the National Agro-Ecological Zoning for Sugarcane (ZAE Cana) study, which was the first study conducted in Brazil that incorporated economic and social considerations into its sustainability model.

"Environmental preservation is a top priority of the Brazilian government," said Celso Manzato, environment unit chief of the Brazilian Agricultural Research Corp. "Sugarcane is an integral crop for Brazil's domestic food supply, renewable energy market and our national exports, and therefore there is a great demand for growth. These measures have been proposed to ensure that sustainable development models are in place to promote the responsible development of this industry."

Specifically, areas of native vegetation, as well as all protected lands in the Amazon, Pantanal and Upper Paraguay River Basin regions would be restricted from use. Expansion of sugarcane production plants would be limited to unrestricted areas that do not require irrigation and have slopes less than 12 percent, which would allow for mechanized harvesting and eliminate the need for crop burning to clear the ground. Credit extension policies will favor expansion of sugarcane facilities to areas that consist of underused or degraded pasture land. Currently operating industrial facilities will be granted exemptions from the proposed policy changes.

According to the Brazilian government, the proposed criteria leave approximately 64 million hectares (158 million acres) available for sugarcane production. The sugarcane industry currently utilizes approximately 8.89 million hectares for sugarcane fields.

The Brazilian Sugarcane Industry Association (UNICA) said while it supports the ZAE Cana concept, various aspects of the proposal demand greater analysis. The association said it was not allowed to review the full proposal prior to its release. One specific concern that UNICA has declared needs to be addressed involves defining the concept of food security, since sugarcane is used to produce both food and energy. "The proposed approach could lead to restrictions in growing sugarcane that would have the reverse effect in terms of food security, by restricting the production of additional sugar," the association stated.

While the association will continue to analyze the proposal, members welcome the restrictions on deforestation in protected areas and reiterate that UNICA's stance has historically argued there is no need to clear forests for sugarcane expansion. Current sugarcane production area occupies 2.4 percent of the country's arable land, and only 1 percent of the land has been dedicated to ethanol production, according to UNICA. Of the 1 percent of arable land used for ethanol production, the country has benefited by supplying 50 percent of its fuel needs with domestically produced ethanol.

The president's proposal came during a tumultuous sugarcane harvest season. Brazilian producers had to endure weeks of heavy rains at the height of harvest, which resulted in a significant loss of volume as well as quality of the crop. September predictions estimated an overall 20 million ton loss for the 2009 harvest season as compared to 2008. However, domestic demand for ethanol has steadily increased as more flexible fuel vehicles (FFVs) have entered the market and as ethanol costs have managed to stay competitive with gasoline. UNICA reported that domestic hydrous ethanol sales rose 24.4 percent in August compared to the same month last year. Brazil's National Association of Automobile Manufacturers reported that 88 percent of light vehicles sold in-country are FFVs and predicted that 65 percent of Brazil's entire fleet will be flex-fuel capable by 2014.