Inpasa Secures R$1 Billion to Expand Corn Ethanol Production in Brazil

Inpasa, one of Brazil’s larger players in corn and sorghum based ethanol, has managed to pull in 1 billion reais (about $173 million) via its sixth debenture issue to help bankroll a big expansion of its industrial complex in Sinop, Mato Grosso.  

The plan is to more or less double the present production ability in Sinop, and, per a filing submitted to the Brazilian Securities and Exchange Commission (CVM), turn the area into the biggest ethanol production hub on Earth. This stretch project is set to add two new units, each one able to produce 1,350 cubic meters of ethanol every day.

SCALING UP RENEWABLES

The total investment for the new facilities is estimated at 1.64 billion reais. Inpasa plans to fund 97.3% of this amount through securities issuances, with the current 1 billion reais debenture offering covering approximately 60.8% of the total project cost.

Beyond biofuel, the new units will also produce corn oil and Distillers Dried Grains (DDGs), a high-protein byproduct used extensively in animal feed. This diversification allows Inpasa to maximize revenue from the grain processing chain in Brazil’s primary agricultural heartland.

FINANCIAL STRUCTURE

The debentures, coordinated by Itaú BBA, were offered exclusively to professional investors. The securities are simple, non-convertible, and unsecured (chirographic), but carry a guarantee provided by JOL Investimentos e Participações — Inpasa paid 3.1 billion reais ($538 million) in dividends in 2025 to JOL Investimentos e Participações, with its primary operational units located in Sinop and Nova Mutum (MT), and Dourados and Sidrolândia (MS).

Following the bookbuilding process, the final interest rate was set at 7.93% per year.

STRATEGIC GROWTH

Founded in Paraguay in 2006, Inpasa entered the Brazilian market in 2018 with its first plant in Sinop. Since then, it has rapidly expanded across the country, with operational units in the states of Mato Grosso, Mato Grosso do Sul, Goiás, Bahia, and Maranhão.

The expansion comes as Brazil sees a surge in corn-based ethanol production, driven by growing global demand for renewable energy and the increasing industrialization of the country’s record corn harvests. If successful, the Sinop complex will consolidate Mato Grosso's position as a global leader in the grain-to-fuel industry.

How Raízen (RAIZ4) Engineered Brazil’s Biggest Corporate Restructuring

Raízen, the Brazilian sugar and ethanol giant and a joint venture between Shell and Cosan, has formalized a record-breaking 64.7 billion reais ($11.5 billion) out-of-court restructuring plan. The agreement, filed with São Paulo’s 3rd Bankruptcy Court, marks the largest "recuperação extrajudicial" (corporate restructuring) in Brazil’s history, securing support from 75.4% of its creditors after months of intense negotiations.

The restructuring follows a period of severe financial strain for the company, driven by aggressive investments in second-generation ethanol and renewable energy projects that coincided with weaker-than-expected sugarcane harvests, high interest rates, and capital-intensive expansions that failed to yield immediate returns.

Step-by-Step Restructuring Framework

The finalized plan outlines a comprehensive roadmap to stabilize the company's finances and reorganize its sprawling operations:

• Debt Conversion and Refinancing: The company will convert 45% of its 64.7 billion reais debt into equity. Creditors opting for this route will receive "Units" (comprising one common and one preferred share) priced at 0.50 reais per Unit. The remaining 55% of the debt will be refinanced through new financial instruments;
• Capital Injection: Shell has committed a 3.5 billion reais ($620 million) cash infusion to bolster the company's capital structure. Aguassanta Participações, linked to the Ometto family, may contribute an additional 500 million reais;
• Asset Divestment: To streamline operations and raise immediate liquidity, Raízen sold its downstream assets in Argentina, including refining and distribution, to the Swiss-based Mercuria Energy Group for $1.42 billion;
• Governance Overhaul: The company’s board will be restructured to include seven members. Four will be appointed by supporting creditors, including the board's chair, while three will be named by the shareholders responsible for the capital injection. Shell will maintain its board presence as long as its brand licensing agreement remains in effect;
• Operational Split by 2027: Raízen plans to divide into two independent entities by the end of 2027: Raízen Energia (focusing on sugar, ethanol, and bioenergy) and Raízen Combustíveis (concentrating on fuel and lubricant distribution under the Shell brand).

Market Reaction and Outlook

Brazilian energy giant Raízen has secured a historic restructuring agreement. Now, the plan, backed by 75.4% of creditors, aims to stabilize the Shell-Cosan joint venture following heavy losses from aggressive renewable energy expansions and high interest rates.

Key components of the deal include:

• Debt-to-Equity Swap: 45% of the debt will be converted into equity, potentially giving creditors up to 80% control;
• Cash Infusion: Shell will inject 3.5 billion reais ($620 million) in new capital;
• Divestment: The company sold its Argentine downstream assets for $1.42 billion to Mercuria Energy Group;
• Strategic Split: By 2027, Raízen will split into two independent units: Raízen Energia (sugar/ethanol) and Raízen Combustíveis (fuel distribution).

Despite initial resistance from major creditors like Itaú Unibanco, the deal provides a clearer trajectory for the company’s survival in the critical agribusiness and energy transition sectors.

The negotiations were characterized by significant friction, particularly with Itaú Unibanco, which initially opposed the deal and attempted to sway other creditors before eventually signing. 

Analysts view the plan as a critical step for Raízen, which is a linchpin in Brazil's agribusiness and energy transition sectors. By converting a massive portion of its debt into equity, creditors could eventually control up to 80% of the company, fundamentally altering the historical Shell-Cosan partnership. Shell stated the move provides "greater financial stability and a clearer trajectory for the future," preserving the brand's presence in Brazil's vital fuel and aviation markets (SAF).

Inside Brazil’s Fastest-Growing Ethanol Market: Mato Grosso’s Billion-Liter Leap

Brazil's Mato Grosso state is poised for a significant surge in ethanol production, with projections indicating a 16% increase to 8.44 billion liters in the 2026/27 harvest. This expansion is primarily driven by the growth of corn ethanol and the establishment of new industrial plants within the state, according to a forecast by the Mato Grosso Bioenergy Industry Union (Bioind-MT) and the Mato Grosso Institute of Agricultural Economics (Imea).

The anticipated growth follows a robust 2025/26 season, which saw the state's ethanol output rise by 8.52% to 7.27 billion liters, while national production remained largely stable with a modest 0.22% increase. Mato Grosso currently holds the second position in Brazil's ethanol production ranking, trailing only São Paulo.

Corn ethanol is expected to be the main catalyst for the 2026/27 expansion, with production from the cereal projected to climb by 18.67% to 7.33 billion liters. Sugarcane ethanol, by contrast, is set for a more moderate increase of 1.42%, reaching 1.11 billion liters. Silvio Rangel, president of Bioind-MT and the Federation of Industries of Mato Grosso (Fiemt), highlighted the state's dominance in corn ethanol, noting that Mato Grosso accounts for 62% of national cereal ethanol production.

Wellington Andrade, executive director of Bioind-MT, attributed this growth to both the expanded capacity of existing facilities and the inauguration of new industrial units. He cited approved financing for ALD Bioenergia and RRP Energia, Inpasa's plant expansion, and new projects from 3tentos and Evermat as key drivers.

The Imea survey also forecasts an 18.52% increase in corn milling for ethanol production, rising from 13.81 million tonnes in 2025/26 to 16.36 million tonnes in 2026/27. By-products of corn ethanol are also expected to see double-digit growth, with DDG and DDGS production increasing by 16.14% to 3.41 million tonnes, and corn oil by 12.9% to 338,900 tonnes. In the sugarcane sector, milling is projected to remain stable at 18.61 million tonnes, while sugar production is expected to decline by 1.42% to 579,700 tonnes.

Long-term projections from Imea suggest continued bioenergy expansion in Mato Grosso, with the state potentially reaching 15.02 billion liters of ethanol production by the 2033/34 harvest, more than double the 2025/26 estimate.

In related developments, Bosch is piloting a technology that combines diesel and ethanol in sugarcane harvester engines. This retrofit system aims to replace up to 60% of fossil fuel use without compromising engine power. The solution, initially developed for large mining trucks, is currently being tested in six sugarcane mills across Brazil. Matheus Pintor, commercial head of Bosch's dual-fuel division, emphasized the economic rationale behind the retrofit, stating that it accelerates decarbonization by utilizing existing machinery rather than waiting for fleet replacement, which can take years.

Meanwhile, Atvos, a Brazilian clean energy company, is advancing its second corn ethanol project in Mato Grosso do Sul. The company has committed to paying R$3.284 million in environmental compensation for a new industrial unit in Costa Rica, with an estimated investment of R$669 million and a production capacity of 150 million to 800 million liters. This new unit will be integrated into Atvos' existing sugarcane ethanol plant in the municipality. The company also announced a similar project near the Santa Luzia plant in Nova Alvorada do Sul, with an investment exceeding R$1 billion, aiming to integrate sugarcane and corn operations and use sugarcane bagasse for energy generation.

Mato Grosso do Sul's corn ethanol industrial park currently operates with three units (two from Inpasa and one from Neomille) and is set for further expansion. Planned projects include an expansion of Inpasa's Sidrolândia plant by 300 million liters and a new plant in Jaraguari with an estimated capacity of 200 million liters per year. The state, a national leader in DDG production, saw approximately 1.40 million tonnes produced last year, with 1.15 million tonnes exported to countries like New Zealand, Turkey, Vietnam, and Spain.

Gasoline vs. Ethanol in Brazil: Why Biofuel Is Winning the Price Battle

Hydrous ethanol has become more competitive against gasoline in Brazil as prices continued to fall in the second week of May, driven by the sugarcane harvest in the country's Center-South region.

According to data analyzed by fleet management firm Veloe, the price ratio between ethanol and gasoline dropped to 69.7% in early May, down from 71.7% in late April. This falls below the critical 70% threshold typically used by owners of flex-fuel vehicles to determine the economic advantage of biofuel over fossil fuels.

A flex fuel car is basically a vehicle whose motor is made so it can run on ethanol, on gasoline, or on some blend of both, and honestly in any proportion. The real little “secret” behind this whole thing is the electronic control unit, also called the injection module. It can identify what fuel is being used and then it automatically tweaks the engine settings, so it aims for the best performance and efficiency. The world’s first mass-produced flex-fuel car was launched in Brazil in 2003: the Volkswagen Gol Total Flex 1.6. From that milestone, this know how spread pretty fast, picking up popularity among the big automakers that are already established in the country. Today, this type of vehicle can be seen everywhere in Brazil.

ETHANOL VS. GASOLINE COMPETITIVENESS

The deepening decline in ethanol prices, which began in mid-April, contrasts with the more moderate price adjustments seen in other fuels:

• Gasoline: Dropped 0.27% to an average of 6.76 reais per liter.
• S-10 Diesel: Decreased 1.27% to an average of 7.21 reais per liter.

"The market is closely monitoring the evolution of the harvest, alongside factors such as global oil prices, exchange rates, and the production mix between sugar and ethanol," Veloe, a subsidiary of Elopar (controlled by Banco do Brasil and Bradesco), said in a statement.

REGIONAL PRICE DROPS

The sharpest absolute price drops for ethanol were concentrated in Brazil's agricultural heartland, reflecting the impact of the ongoing harvest:

• Goiás: -4.9%
• São Paulo: -4.7%
• Federal District: -4.6%
• Minas Gerais: -4.2%
• Mato Grosso: -4.1%

Analysts suggest that the increased supply from the Center-South harvest is the primary driver behind these regional declines, providing relief to consumers and improving the biofuels' market share.

From Sugarcane to Gas Tank: Brazil’s 32% Ethanol Blend Set to Transform Biofuel Market

Brazilian President Luiz Inácio Lula da Silva is set to authorize an increase in the mandatory ethanol blend in gasoline from 30% to 32%, a move aimed at curbing fuel imports and enhancing national energy security amid global oil market volatility driven by the conflict between Iran and the United States.

The proposal, which could be signed as early as this week during an extraordinary meeting of the National Energy Policy Council (CNPE), is expected to eliminate Brazil’s reliance on imported gasoline. Despite being a major oil producer, Brazil currently imports between 10% and 15% of its gasoline due to domestic refining bottlenecks.

Boosting Demand and Local Production

The shift to a 32% anhydrous ethanol blend (E32) is projected to increase annual demand for the biofuel by approximately 1 billion liters, according to UNICA, the industry association representing sugarcane and ethanol producers.

Industry leaders expressed optimism, noting that Brazil is heading toward a record harvest. National supply agency Conab recently revised its production estimates upward, forecasting a 5.3% increase in the current harvest that began in April.

"We have total capacity to meet this demand," said a representative from the sugarcane industry. "In addition to consumer and environmental benefits, Brazilian ethanol generates jobs and income in both rural and urban areas."

Technical Readiness vs. Consumer Concerns

Minister of Mines and Energy Alexandre Silveira stated that technical tests have already confirmed the safety and viability of the E32 blend for vehicle engines. However, the move has faced some pushback from automotive sectors.

While the government maintains that engines are ready, some critics and industry groups, including the motorcycle manufacturers' association Abraciclo, have raised concerns. Reports suggest that higher ethanol concentrations could lead to ignition issues in colder temperatures and potential long-term compatibility problems that have not been fully vetted.

Market Adjustment and Increased Demand

The blend expansion is also expected to have a direct impact on anhydrous ethanol consumption. According to Martinho Seiiti Ono, CEO of SCA Brasil Etanol, E32 could increase biofuel demand by about 850 million liters per year. This surge in demand comes as production is estimated to grow by over 4 billion liters this harvest, including both sugarcane and corn ethanol. In this context, the higher blend serves as a mechanism to absorb surplus supply, ensuring market equilibrium.

The measure is also expected to reduce price volatility throughout the cycle and improve conditions for consumers, while providing greater predictability for ethanol contract renewals for the 2026/27 harvest. Furthermore, it is anticipated to boost the competitiveness of hydrous ethanol by altering the traditional 70% price parity threshold.

Beyond economic impacts, E32 reinforces Brazil's position in the global decarbonization agenda. The measure aligns with the "Fuel of the Future" program, which envisions a gradual increase in the blend up to 35% and paves the way for new frontiers, such as Sustainable Aviation Fuel (SAF) and renewable bunker fuel.

Global Market Impact

The announcement has already reverberated through international commodity markets. As Brazilian mills pivot to produce more anhydrous ethanol to meet the new mandate, global sugar prices have seen a slight recovery. Analysts suggest that Brazil’s sugar production could drop to 37 million tonnes — down from previous estimates of 40 million — as more sugarcane is diverted to biofuel production.

The policy is part of a broader "Fuel of the Future" strategy, which also envisions increasing the biodiesel blend in diesel to 16% this year, with a target of 20% by 2030, pending further technical testing.

Brazil Expands Ethanol Use as Vale Launches Ethanol-Powered Shipping Strategy

Vale SA, the Brazilian mining company, has established a charter agreement to use transoceanic vessels which will operate mainly on ethanol. This decision supports Brazil's efforts to increase biofuel usage in its national energy system and become a leading global player at the forefront of maritime transport.

Vale announced it has finalized a 25-year deal with China's Shandong Shipping Corporation for the construction of two new-generation Guaibamax ore carriers, with an option for additional vessels. The ships which will be delivered to customers from 2029 onwards will use ethanol as their primary fuel according to the company which claims this approach will decrease carbon emissions by 90 percent when compared to standard heavy fuel oil.

The initiative is part of Vale's strategy to decarbonize its maritime transport chain. The company will achieve its goal to decrease Scope 3 emissions, which include shipping, by 15% before the year 2035. "The initiative reinforces the company's commitment to reducing its carbon emissions in the value chain and promoting decarbonization in the maritime sector," Vale said in a statement.

The 325000 ton capacity vessels will use a multi-fuel strategy which enables them to operate with methanol and traditional marine fuel oil while their design allows future conversion to liquefied natural gas LNG and ammonia.

Government Boosts Ethanol Demand

The Brazilian government plans to increase mandatory ethanol gasoline blending requirements which will occur at the same time as the industry shifts toward sustainable fuel solutions. Minister of Mines and Energy Alexandre Silveira confirmed plans to raise the mixture from 30% to 32% within the first half of 2026.

This follows a previous increase from 27% to 30% in August 2025. Market analysts report that each percentage point increase in the blend results in an additional annual demand of approximately 840 million liters of anhydrous ethanol. The latest proposed hike could therefore boost demand by nearly 1.7 billion liters.

Safras and Mercado analyst Maurício Muruci explained that this timing serves a strategic purpose because it coincides with the beginning of sugarcane harvest season which enables mills to modify their production processes. The increased demand for anhydrous ethanol tends to direct more sugarcane to ethanol production which reduces the supply of sugar and drives up prices for both products according to Muruci.

Consumers Weigh Costs at the Pump

The Brazilian streets show drivers who have different opinions about which fuel provides better economic advantages between ethanol and gasoline. While ethanol is significantly cheaper at the pump — often by R$1.50 to R$2.00 per liter — the fuel provides drivers with less efficient driving range. 

The ride-sharing drivers who operate their vehicles at high mileage multiple times during the day find that using lower-priced ethanol helps them save more money. The consumers who use gasoline believe that its higher energy content makes it a better fuel choice because of their view that the price difference does not make up for ethanol's lower driving distance.

Brazil’s Ethanol Power Play: How Sugarcane and Corn are Shielding the Economy from a Global Oil Shock

Brazil's long-standing ethanol program is proving to be a crucial buffer against rising global oil prices, particularly as the conflict involving Iran, the United States, and Israel enters its fifth week. Nations like India and Mexico are now examining Brazil's energy security model as a potential blueprint.

The South American giant is partially shielded from international oil market volatility by its decades-old, cost-effective, and environmentally friendly ethanol initiative. Millions of Brazilian motorists have the option to fuel their vehicles with 100% sugarcane-derived ethanol or a gasoline blend containing 30% biofuel.

Brazil's extensive fleet of flex-fuel vehicles, capable of running on any combination of ethanol and gasoline, is unparalleled globally. The program Proálcool (Programa Nacional do Álcool), initiated in 1975, has successfully evolved to reduce the country's reliance on foreign oil.

While consumers worldwide grapple with significant price hikes, gasoline prices in Brazil saw a modest 5% increase in March, starkly contrasting the 30% surge observed in the United States. Analysts attribute this stability to Brazil's mature domestic biofuel industry, which enables the nation to absorb geopolitical shocks with minimal risk of fuel shortages.

Evandro Gussi, president of the Brazilian Sugarcane Industry Association (UNICA), emphasized that Brazil is "much better prepared than most countries" due to this viable alternative. The upcoming sugarcane harvest, set to commence in early April, is projected to yield a record 30 billion liters of ethanol, a 4 billion liter increase from the previous year. Gussi noted that this additional volume alone is equivalent to Brazil's total gasoline imports for the entirety of last year.

Despite being a significant crude oil producer and exporter, Brazil remains dependent on imports for refined fuels, sourcing from countries including the United States, Saudi Arabia, Russia, and neighboring Guyana. Nevertheless, ethanol has become integral to daily transportation, with 37.1 billion liters sold in 2025, according to the state-owned Energy Research Company (EPE). Its widespread availability provides Brazilians with both psychological and economic reassurance.

Research and Development

The success of Brazil's biofuel economy is deeply rooted in São Paulo, the country's industrial and agricultural heartland. Production methods encompass both high-tech, export-oriented 'megafarms' and smaller, family-run operations. State-funded research, exemplified by the Unicamp Ethanol Scientific Development Center in Campinas, also plays a pivotal role in advancing Brazilian biofuel technology. Luis Cortez, the center's coordinator, underscored the unique advantages of Brazil's program, asserting that investment in research ultimately translates into tangible benefits at the fuel pumps.

Diesel Sector Challenges

While the potential closure of the Strait of Hormuz has not significantly impacted Brazil's gasoline market, the nation faces considerable challenges with escalating diesel prices. Diesel is predominantly produced from imported crude oil and incorporates a smaller proportion of biofuels. Brazilian biodiesel, primarily derived from soybeans, constitutes only 14% of the diesel blend. This percentage is not expected to reach 30% until 2030, implying an immediate impact from the ongoing conflict.

Brazilian diesel prices climbed over 20% in March, prompting President Luiz Inácio Lula da Silva to propose import subsidies until May. Government estimates suggest Brazil needs to import between 20% and 30% of its monthly diesel requirements, with the majority originating from Russia. Brazilian authorities reported nearly 17 billion liters of diesel imported last year. For President Lula, who is seeking re-election in October, stabilizing diesel prices is paramount to avert trucker strikes and mitigate food inflation.

Rabobank calculations indicate that increasing the anhydrous ethanol blend in gasoline from the current 30% to 32%, a measure advocated by some segments of the sugar-energy sector, could displace 1.2 billion liters of gasoline over a 12-month period. This would effectively substitute 34% of fossil fuel imports, considering Brazil imported 3.5 billion liters of gasoline A last year. However, such a modification is contingent upon technical tests, which the Ministry of Mines and Energy (MME) is currently facilitating. Industry leaders anticipate that an increased blend would only be feasible next year.

Should an increased ethanol blend be implemented sooner, it would also permit a rise in hydrous ethanol prices (which compete with gasoline at the pumps) relative to fossil fuels. Hydrous ethanol prices are typically discounted against gasoline due to its lower energy yield, generally hovering around 70% — a level that fluctuates with biofuel supply. Rabobank estimates that an increase in the anhydrous ethanol blend to 32% would reduce the hydrous ethanol price discount by 2%.

Presently, gasoline maintains a 30% anhydrous ethanol content, and its average pump price in Brazil rose 6% in March amidst speculation surrounding the Middle East conflict's repercussions. This occurred despite Petrobras not increasing the price of gasoline A sold at its refineries. The state-owned company accounts for 80% of the country's gasoline A supply capacity.

Recent Investments in Biofuels

On March 25, Grupo Potencial, a conglomerate with interests in energy, fuels, and agribusiness, announced a significant investment of BRL 6 billion ($1.2 billion USD) by 2030. Carlos Eduardo Hammerschmidt, the company's Vice-President for Commercial, Institutional Relations, and New Investments, stated that the objective is to further develop their integrated supply chain model and expand operations within a rapidly growing market. The group is already a prominent player, holding the title of Latin America's largest single-plant biodiesel producer, with an annual capacity nearing 1 billion liters. Approximately 15% of all soybeans cultivated in Paraná are processed, directly or indirectly, by the company. In 2025, Grupo Potencial's revenue increased by 15% to BRL 12 billion ($2.4 billion USD), with new investments projected to boost revenue to BRL 20 billion ($4 billion USD) within four years.

In another development, RRP Energia, a subsidiary of Grupo Piccini, secured BRL 1 billion ($200 million USD) in financing from BNDES (National Bank for Economic and Social Development) for the construction of a corn ethanol plant in Tapurah, Mato Grosso. The new facility will have the capacity to produce up to 459 million liters of hydrous ethanol or 452 million liters of anhydrous ethanol annually. Additionally, it will process over 1 million tons of corn each year, yielding valuable by-products such as animal feed ingredients and corn oil. The BNDES credit covers more than 60% of the project's total investment, structured as a long-term loan with the bank serving as the primary financier. The funding originates from the Climate Fund and the BNDES Finem line, qualifying the project due to its association with renewable fuel production and its potential to substitute fossil fuel sources.

Raízen (RAIZ4) Confronts R$65bn Debt Mountain in One of Brazil’s Biggest Energy Restructurings

Raízen, one of Brazil's largest energy companies, and a Shell and Cosan joint venture, has submitted an extrajudicial recovery application to renegotiate its R$65 billion debt obligations. 

The company which leads the worldwide biofuel market faces what an expert called a "perfect storm" because high interest rates and increased competition and the market refuses to pay extra costs for its eco-friendly products. The restructuring process represents one of the most extensive corporate restructurings in Brazilian history because it ranks after the Odebrecht (now known as Novonor) case.

Marcelo Gasparino who worked as a board member for Petrobras and served as Vale's board vice-president called the action a "courageous decision." He explained that "The approval process for this radical measure exists challenges because people need to understand that they must break eggs to create an omelet.

Raízen experienced its current problems because it pursued aggressive expansion which required debt financing during a time when interest rates were low, at 2%, in 2020, and now interest rates in Brazil are at 15% — or many economists, one of the reasons interest rates are so high is the irresponsible way the Bolsonaro government lowered interest rates in 2020. Critics point out that the measure, taken with the aim of stimulating the economy during the pandemic, was late or excessive, contributing to inflation and currency devaluation. 

At this time, Raízen made substantial investments in second-generation (E2G) ethanol which operates as a cleaner biofuel but the market has taken time to accept it. At the same time, Brazil witnessed the emergence of lower-priced corn-based ethanol products which has established strong competition to Raízen, that produces ethanol from sugarcane.

Another major change at Raízen, that now is seen as a strategic mistake, was when the company, in 2019, entered the retail sector through a partnership with the Mexican group FEMSA, bringing the convenience store chain Oxxo to Brazil. Analysts viewed the move as a distraction because it fell outside the company’s core energy business.

The venture required heavy capital investment to open hundreds of stores, but returns fell short of expectations. After searching for potential buyers for its stake, Raízen’s leadership decided to exit the business. Continuous cash burn led the joint venture to end in 2025.

Following the split, FEMSA resumed control of Oxxo’s Brazilian operations, while Raízen retained management of more than 1,300 Shell Select and Shell Café convenience stores. The Brazilian Oxxo operation never reached break-even, becoming a factor that worsened Raízen’s current financial crisis.

Gasparino also explained the situation now: the restructuring plan which has already been approved by creditors who control 47% of the debt provides multiple solutions which include non-core asset sales and debt-to-equity conversions and new capital funding from Shell and Cosan which are the parent companies.

The company has made a statement about its operations which will remain unchanged but minority shareholders will suffer the most from the upcoming crisis. According to Flávio Conde, analyst of Levante Investimentos,  now creditors are goingo to take control of all business value during a high-debt restructuring because they hold priority over shareholders.

Although the situation is very concerning, the company still maintains a strong position in its core fuel distribution operations, and management has taken steps in recent months to secure its future. Gasparino, for example, explained the situation by saying: “I see light at the end of the tunnel because the work being done now will create better results for everyone involved than what exists today.”

Now, the expectation is for deleveraging through an out-of-court restructuring process, aimed at improving margins in the distribution business, but with shares under heavy pressure and amid strong market skepticism.

Brazil Researchers Develop Low-Cost Catalyst to Boost Ethanol-to-Hydrogen Production

Researchers in Brazil have developed an advanced catalyst that significantly improves the efficiency and stability of ethanol-to-hydrogen conversion, offering a potential pathway to lower-cost, low-carbon hydrogen production, according to Agência Fapesp.

The study, led by Fabio Coral Fonseca of the Institute for Energy and Nuclear Research (Ipen) and published in the International Journal of Hydrogen Energy, demonstrates that fine control over the processing of perovskite-type ceramic materials can enhance hydrogen yields while eliminating the need for expensive noble metals.

Hydrogen is widely viewed as a key component of the global energy transition, particularly when produced from renewable sources. In Brazil, abundant ethanol derived from biomass presents a strategic opportunity for hydrogen generation through ethanol steam reforming (ESR), a high-temperature process in which ethanol reacts with steam to produce hydrogen and carbon dioxide.

The research focuses on improving catalysts used in ESR. Instead of applying nickel to the surface of ceramic materials through conventional impregnation methods, the team incorporated nickel directly into the perovskite crystal structure during synthesis. Under controlled conditions, the metal “exsolves,” forming highly stable nickel nanoparticles firmly anchored to the surface.

This approach enhances catalytic stability, reduces carbon deposition and prevents particle agglomeration at high temperatures, common issues that degrade conventional catalysts.

A key finding of the study is that calcination temperature plays a decisive role in performance. Catalysts calcined at 650°C delivered the best results, achieving 100% ethanol conversion, producing more than four moles of hydrogen per mole of ethanol, and maintaining stable operation for up to 85 hours with minimal coke formation. Higher calcination temperatures reduced surface area, limited nickel exsolution and weakened performance.

Fonseca emphasized that manufacturing conditions are as important as material composition. “A relatively simple adjustment in processing completely changes performance,” he noted.

Beyond ethanol reforming, the team is also exploring direct ethanol fuel cells as an alternative route for energy conversion. Their broader research into metallic exsolution in perovskites includes prior collaboration with U.S. institutions supported by the São Paulo Research Foundation and the National Science Foundation.

The scientists are now advancing toward highly controlled epitaxial thin films to study catalytic behavior at the atomic scale, using advanced characterization tools at Sirius, Brazil’s synchrotron light source.

By demonstrating that abundant, low-cost metals such as nickel can achieve high catalytic performance when properly engineered, the research outlines a promising route to reduce reliance on noble metals and strengthen sustainable hydrogen production, particularly in Brazil, where ethanol infrastructure is already well established.

Corn Ethanol in Brazil: Sustainable Biofuels Driving Food, Feed, and Fuel Production

Since 2017, the corn ethanol industry has gone through rapid growth in Brazil, establishing itself as the delicate foundation of the country's bioeconomy. Representing 98% of the companies producing ethanol from corn in Brazil, the Brazilian Corn Ethanol Association (UNEM) has been supporting the cause of environmentally sustainable fuel production and at the same time markets for food and feed.

Brazil currently has 21 ethanol plants utilizing corn, with half devoted only to corn ethanol and the other half flex plants that convert ethanol from sugarcane as well. Another 22 plants have now been planned or are under construction and shall raise production from 2.2 billion gallons presently to about 3.5 billion gallons in the coming years.

Those plants frequently employ renewable power sources, such as eucalyptus wood chips, hence lessening carbon footprints. Brazil plans also to sell carbon credits, thereby rendering the price of its ethanol lower worldwide, particularly for market areas such as Europe and California.

Now, Brazilian ethanol may gain stronger competition in the international platform. Overall, the establishment of the corn ethanol industry in Brazil has very steady growth, thus adding value to the domestic corn and its consequent production as a source of renewable fuels.

A Decade of Growth: The Period from Inception to Growth

Although still a young industry, Brazilian corn ethanol development has been quite impressive. Productivity has increased by 87% during this century, and the cultivated area in corn has also expanded by about 70%. Such intense evolution has been the result of modern biotechnology, new agricultural practices, and the introduction of corn ethanol production technologies from the USA.

This industry is not only intensifying crop production but is also enhancing land-use efficiency. Unique to Brazil is a double cropping system wherein two crops can be harvested in one year on the same land. For instance, soybean in summer and corn in winter, allowing livestock to graze in between. In some areas, corn is planted also as a third crop to increase productivity without any deforestation.

Corn Ethanol: Food, Feed, and Fuel

A common concern among international audiences is the so-called “food versus fuel” debate. In Brazil, this conflict is largely mitigated through sustainable production systems. Corn ethanol production generates multiple outputs:

• Ethanol fuel: 440 liters per ton of corn
• DDGS (Distillers Dried Grains with Solubles): 212 kg per ton of corn, a highly nutritious animal feed
• Corn oil: 19 kg per ton of corn
• Excess electricity: Supplied back to the grid

By using renewable sources like wood chips and even bamboo for steam production, Brazilian corn ethanol plants create a circular, environmentally sustainable system that provides fuel, food, and feed.

Expanding Production and Global Exports

Currently, Brazil operates 24 corn ethanol plants, with another 16 under construction and an additional 16 planned. Production is spreading geographically, from the central west region to the northeast, south, and north of Brazil, while also incorporating alternative crops such as sorghum and wheat for ethanol production.

The DDGS export market is growing rapidly, especially in Asia. In just four years, exports rose from $1 million to nearly $190 million. China alone has shown interest in purchasing 5 million tons of DDGS, highlighting Brazil's potential to become a global leader in renewable feed and biofuels.

Flex-Fuel Technology and Sustainability

Brazilian vehicles, 77% of which are flex-fuel, can run on either ethanol or gasoline. This flexibility reduces greenhouse gas emissions and positions Brazil as a global leader in sustainable mobility. Moreover, ethanol-fed DDGS allows livestock to be produced more efficiently, reducing the carbon footprint per animal while meeting international food demands.

Looking Ahead: Innovation and Carbon Reduction

The future of Brazilian corn ethanol includes:

• Sustainable aviation fuels to reduce emissions in the aviation sector
• Maritime biofuels for shipping industries
• Bioenergy with carbon capture and storage (BECCS): The first plant will become carbon-negative by capturing CO₂ from ethanol production and storing it underground

With the government increasing ethanol content in gasoline to 30% and the upcoming COP 30 in Brazil, the industry is well-positioned to accelerate renewable energy adoption while supporting the food-plus-fuel model, simultaneously producing fuel, feed, and food sustainably.

Brazil’s corn ethanol industry demonstrates that biofuel production can coexist with agricultural growth, environmental sustainability, and global trade expansion. With increasing domestic production, international exports, and ongoing technological innovation, Brazilian corn ethanol is setting a benchmark for the world in sustainable bioenergy solutions.