BUSINESS FEATURE NATURE|Vol 444|7 December 2006

Drink the best and drive the rest

Brazil’s sugar-cane ethanol industry is the world’s best and able to get better, says Emma Marris.
n Brazil, alcohol made from sugar cane is

PAULO WHITAKER/REUTERS
mixed with lime juice and a little of the cane
sugar itself to make caipirinhas — and it’s a
fine way to get the weekend off to a flying
start. But come Monday morning, sober Brazil-
ian commuters are still using cane liquor — in
their fuel tanks. Most Brazilian petrol is gasohol,
which by government mandate is currently 23%
ethanol. Next to the gasohol pumps at the petrol
stations are pumps that offer pure ethanol.
Ethanol from sugar cane has been power-
ing cars in Brazil on and off since the 1930s,
and with government backing since the OPEC
price rises in the 1970s. It makes fairly obvi-
ous sense. Brazil’s tropical sun makes it a great
place for growing sugar cane: it is the largest
cane producer in the world, producing more
than twice as much as the number two, India.
Just crush out the sucrose solution, ferment it
into alcohol with the help of yeast and distill it
to the desired concentration; burn the ‘bagasse’
— the fibrous pulp left over when the sugar is
squeezed from the cane — to power the process
along. Put the alcohol into your gas tank and
you are effectively driving it on sunlight.
In the past few years, Brazil’s bioethanol Cleaning up: Brazil’s use of sugar cane, here being washed for refining, significantly reduces CO2 emissions.
industry has sprouted new wings thanks to
higher petrol prices and ‘flex-fuel’ cars, which lion jobs, in a country with an unemployment machinery in the sugar-cane industry1. He and
can sense different mixtures of petrol and rate of 10%. Some bagasse-powered mills sell his colleagues estimate that the whole shebang
ethanol and adjust their workings accord- surplus power back to the grid. And although costs about 250,000 kilojoules per tonne of
ingly. Introduced to the mass market in 2003, the carbon put into the atmosphere by petrol- cane. That tonne of cane in turn yields about
these cars changed everything; flex-fuel vehi- powered cars comes out of fossil reserves, the 2 million kilojoules in ethanol and surplus
cles now account for well over half of Brazil’s carbon from ethanol is carbon that was in the electricity made by burning bagasse. That’s an
new cars. Their attraction is that they allow atmosphere just a couple of years ago, before eight-fold return.
the owner to trade off continually between the sugar cane got hold of it and worked its This is a lot better than ethanol-makers in
the advantages of neat ethanol — which gives photosynthetic miracle. There are thus, in the United States manage, and the reason is
20% to 30% fewer kilometres to the litre — and principle, no net emissions. clear to anyone who’s ever strolled through a
gasohol depending on the current prices and This all sounds a bit like a free lunch, or cane field chewing on a bit of the stuff; cane
the local tax rates. (Tax alone means that if you at least a free ride, and everyone knows they is a far more prolific plant than corn (maize),
were to take a road trip across Brazil, you’d don’t exist. Growing sugar cane, harvesting it, from which the United States makes almost all
switch back and forth a couple of times as you fermenting and distilling it and then distrib- its ethanol, and it puts a great deal of its — or
crossed from state to state.) uting it is a complex business. It uses inputs rather the Sun’s — energy into making sugar.
— fuel for harvesters, nitrogen fertilizers for What’s more, sugar cane needs less by way
Sweet solution? the cane — that themselves require energy of inputs, and in the parts of Brazil where most
Flex-fuel cars have created an expanded home from elsewhere. And it has potentially dam- of it is grown at the moment it needs no irri-
market for Brazil’s ethanol, and production is aging side-effects, such as soil erosion and the gation. It needs only to be ploughed up and
up. The country produced 282,000 barrels (45 emission of nitrous oxide, a greenhouse gas, replanted every five years; between times it
million litres) a day in 2005, up from 192,000 in from farmland. Taking all the complexities can be cropped repeatedly and will simply
2001. The ministry of agriculture is projecting into account, is ethanol still as good a deal as grow back, although the yields drop a bit with
442,000 barrels a day by 2010. Oil is still very it seems? And if it is, how much of this good each harvest. For all these reasons, sugar-cane
much ethanol’s big brother, and in the first part thing can Brazil — and the rest of the world ethanol is also currently the cheapest ethanol
of 2006 the country was producing an average — get its hands on? to produce in the world. A litre costs about 25
of more than 2 million barrels a day while con- In 2004, Isaias de Carvalho Macedo at the cents to make. The commodity price for anhy-
suming a bit more. But 40% of the fuel power- University of Campinas did a study for the state drous ethanol (the kind mixed into gasohol) is
ing Brazil’s cars is home-grown ethanol. The of São Paulo that considered energy inputs about 27 cents.
sugar cane industry supports more than a mil- such as fertilizer manufacture and agricultural Because of this a lot of money is pouring
670
©2006 Nature Publishing Group
NATURE|Vol 444|7 December 2006
into the centre-south region of Brazil, where
the sugar cane grows best. But that does not
necessarily mean that investors believe Brazil-
ian cane ethanol is sure to become the planet’s
biofuel of choice. A range of other emerging
liquid-fuel technologies, including biodiesel,
butanol, coal to liquid, and the buzz leader at
the moment, cellulosic ethanol (see page 673),
are attracting investment around the world,
too. And the investors are typically backing
a range of possibilities while they wait to see
how the market pans out.
Arnaldo Vieira de Carvalho, an energy spe-
cialist at the Inter-American Development
Bank in Washington DC, sees current invest-
ment in bioethanol as, among other things,
a way of building up a better stake today
for whatever the most impressive biofuel
technology turns out to be tomorrow. “If
you now put your money in distilleries, in
five years you have made your money,” says de
Carvalho, “and then you put your investment
in the technology that is coming.”
Fuelling change
As the rest of the world gets interested in etha-
nol, both as a fuel in its own right and as a fuel
additive (to replace methyl tertiary-butyl ether,
or MTBE, an anti-knocking additive that is on
its way out for environmental reasons), Brazil
is ramping up exports (see ‘Key companies).
Brazilian manufacturers are actively promot-
ing ethanol distribution systems in other
countries. Petrobras, until the 1990s the
state oil monopoly and
PA L M
l (from fr
D U C T: Biodiese
O
FUEL PR tropical
E: Humid
CLIMAT IELD: 5,000–6,0 :
LY
ANNUA AS SAVIN
OUSE-G
GREENH
No data tations
NS: Plan
ERATIO forest ra
CONSID o p ic a l
om tr
carved fr tal concerns
en
environm
BUSINESS FEATURE
SUGAR
CANE
such as liquid waste and smoke from
R. HODGKINS
burning fields to take into account. Last
year, a paper by a group at Washington
State University in Richland made head-
lines by claiming that in this broadest per-
spective, Brazil’s ethanol was bad for the
environment2.
This result, though, is disputed — and the
industry seems to be getting greener as it goes
hunting for efficiency gains. As Christopher
Flavin, an analyst at the World Watch Insti-
tute, a green pressure group in Washington
FUEL PRO
D
CLIMATE UCT: Ethanol (fro DC, points out, expansion will generally mean
: Tropical m sugar)
ANNUAL
YIELD: 5
, subtrop
ical that a higher percentage of the industry will be
GREENH ,300–6,5 using newer, cleaner technology (although by
OUSE GA 00 litres –1
87–96% S SAVIN ha
CONSID
(vs petro
l)
GS: the same token it will also be offering fewer
ERATION unskilled distillery jobs). The leftovers from
crop resi S:
due power In newer facilities,
adds pow
er to grid
s fuel pro
duction an distillation, once commonly thrown into riv-
d ers, are now often spread on fields as potassium
fertilizer. Field burning, which by scorching the
still the biggest cane makes it easier to harvest with machetes,
player in Brazilian oil, is plan- is decreasing both as a result of legislation and
ning to build an ethanol pipeline from the the increased use of mechanized harvesters.
centre to the south, out to the ports. It will be “Thirty-five per cent of cane harvesting is
the first of its kind. Pipelines for ethanol have already mechanized,” says Nastari, “and it will
long been considered problematic, as it tends increase,” although because the machines work
to absorb moisture and impurities as it flows. only on very flat land some burning is likely to
Construction will start in January, according continue. Research on planting methods that
to Plinio Mario Nastari, president of Datagro involve less or no tilling should lead to reduced
in São Paulo. erosion, too.
Not all foreign markets are easily tapped. Perhaps the biggest environmental worry
Increasing Brazilian ethanol imports to the is that expanding ethanol production will lay
United States led the United States to slap waste to natural forests in its path, reducing
on a tariff of 14 cents per litre (54 cents per biodiversity and releasing stored up carbon.
gallon), to protect its highly subsidized corn The first thing to remember on this
ethanol makers. One effect of this has been
to put Jeb Bush, Florida’s governor, at odds
with his brother President George W. Bush; CA SS AVA
the governor would rather buy cheap ethanol
from Latin America than expensive stuff from
the Midwest.
Environmentalists are watching all this
expansion carefully. The Macedo analysis sug-
gests that a tonne of cane used as ethanol fuel
represents net avoided emissions equivalent
to 220.5 kilograms of carbon dioxide when
compared with petroleum with the same
energy content. The team extrapolates that
ethanol use in Brazil reduces greenhouse-
gas emissions by the equivalent of 25.8 mil-
lion tonnes of carbon dioxide equivalent a
year. For comparison, Brazil’s total carbon
dioxide emissions from fossil fuels is 92
uit)
million tonnes a year, according to the
FUEL PRODUCT: Eth
ha–1 US Department of Energy. The improve- anol (from starch)
00 litres CLIMATE: Tropical,
ment is thus substantial, if not out-of- subtropical
GS ANNUAL YIELD: No
data
this-world. GREENHOUSE-GAS
SAVINGS:
But there are environmental worries No data
ise CONSIDERATIONS
that go along with the ethanol industry : Most cultivated
crop in sub-Saharan
too: as well as fertilizer and fuel use, Africa
there are also pesticides and pollutants
671
©2006 Nature Publishing Group
 BUSINESS FEATURE
Interior designs: some of Brazil’s Cerrado region could be cleared for sugar-cane plantations.
front, say the Brazilians, is that Brazil is big. It is
LUIZ CLAUDIO MARIGO/NATUREPL.COM
big enough to expand its sugar-cane fields mas-
sively without either displacing necessary food
crops or getting anywhere near the rainforest
that the rest of the world seems to have decided
is international property. São Paulo state itself
is as big as the United Kingdom. Although Bra-
zil is already by far the largest producer of sugar
cane in the world, sugar cane is only its fourth
biggest commodity, in terms of revenue, with
cattle, chicken and soya all bringing in more
money. The limiting factor in expansion is
capital rather than land.
Growth area
According to Nastari, cane fields account for just
5.7 million hectares in a country of 850
million hectares. There are already 100
million hectares of old agricultural land or
pasture land in the centre-south available
for the industry to expand into. Eduardo
Pereira de Carvalho, president of Unica,
the union of cane-growers in São Paulo,
welcomes such expansion with open arms:
“As for conflict between food and energy,
the fantastic increase in productivity has
made all these Malthusian arguments com-
pletely nonsense, and we have hundreds of
millions of hectares of idle land.”
Expansion into at least some of those mil-
lions of hectares would probably be more
or less carbon-neutral, says Robert Boddey,
a soil chemist at Embrapa, the Brazilian
agricultural research unit. “For degraded
pastures, which are slowly losing carbon, it
is not such a bad change. And almost 70%
of the Cerrado [Latin America’s savanna,
of which Brazil has some 200 million hec-
R. HODGKINS
tares] has already been cleared.” Because it
needs a dry season, sugar cane would not be
a good crop to move into cleared rainforest
672
NATURE|Vol 444|7 December 2006
Key companies
Cosan, based in São Paulo, is the largest
sugar-cane producer in the world, and the
second-largest producer of ethanol. It has
been gobbling up smaller ethanol mills right,
left and centre, which has given it a very
respectable growth curve. In the 2005–06
crop season, it reported revenues of US$1.1
billion and produced about 8.7 million barrels
of ethanol. Cosan went public in November
of 2005 at about $19 a share, and prices were
close to $60 this summer.
Copersucar, a cooperative of sugar and
ethanol mills, was founded in 1959. In the
2005–06 crop season, its revenues were
$2.1 billion, and it produced 23 million barrels
of alcohol.
areas, even if that was what anyone wanted. them can be grown in the Amazon — cotton,
In this respect, cane is more environmentally soya, livestock”. Some of that soya could be for
friendly than palm oil, the most energy-inten- biodiesel use.
sive source of biodiesel. Palm-oil plantations Alex Farrell, head of the Energy and
for biofuel are having serious effects on the Resources Group at the University of Califor-
primary forests of Indonesia, but are not as yet nia, Berkeley, adds that for all the enthusiasm
big business in Brazil. there is still a dearth of evidence on the long-
Overall, the environmental problems with term sustainability or otherwise of cane farm-
cane production, says Flavin, are “dwarfed by ing. But, he adds, that is pretty much par for
the land use issues posed by soyabeans and the agricultural course: “All around the world,
cattle”. But they may get worse — or exacer- every government has agriculture — they
bate the problems elsewhere in agribusiness. never ask ‘is this agriculture sustainable?’ Not
Jason Clay of environmental group the WWF for sugarcane, not for rutabagas.”
points out that “the push of sugar cane is going To replace a tenth of today’s global petrol
to displace other crops, and some of production, Brazil’s ethanol production would
have to grow by a factor of 40 or so. Few see
that as likely in itself. Even Unica’s de Carvalho,
CO RN EA RS who is undeniably bullish, sees only a doubling
by 2014, though he does not see that as the end
of the story. Enthusiasts for new cane varieties
talk of doubling the yield per hectare, but not
necessarily going much further.
But a doubling or two is not to be sniffed
at, and there is increasing interest in spreading
the techniques developed in this most cane-
friendly of countries to others in Latin America
and elsewhere, with the details changed to fit
local conditions. Already, ethanol is becoming
a large enough business for the price of sugar
on world markets to respond to changes in the
oil markets — so the price of your caipirinha
is now, in a very small way, susceptible to the
manoeuvres of OPEC. ■
Emma Marris is a reporter for Nature based
rch)
Ethanol (from sta in Washington DC.
FUEL PRODUCT:
erate
CLIMATE: Temp es ha–1
: 3,100–3,900 litr 1. Macedo, I. et al. Assessment of Greenhouse Gas Emissions in
ANNUAL YIELD NG S:
AS SAVI the Production and Use of Fuel Ethanol in Brazil (prepared for
GREENHOUSE-G the Government of the State of São Paulo) (March 2004).
l)
10–20% (vs petro
NS: 2. Dias de Oliveira, M. E., Vaughan, B. E. & Rykiel, E. J.
CONSIDERATIO ut
d agricultural inp Bioscience 55, 593–602 (2005).
High fertilizer an
See Editorial, page 654.
©2006 Nature Publishing Group