FS Bioenergia to build Brazil’s second corn ethanol plant

FS Bioenergia, a joint venture between Brazilian and US-based investors

FS Bioenergia, a joint venture between Brazilian and US-based investors, will build its second corn-based ethanol plant in Brazil’s top grain-producing state of Mato Grosso. It is first large-scale corn ethanol production venture to build a 100% corn-based ethanol plant in Brazil, where basically all ethanol is made from sugar cane. It will invest around US$308 million on the second project.

FS Bioenergia, which is the result of an international collaboration between Brazilian agribusiness Fiagril and US-based Summit Agricultural Group headquartered in Alden, Iowa, opened a US$115 million corn-only ethanol production facility located in Lucas do Rio Verde, Mato Grosso, last year.

For the second project, FS Bioenergia followed the same strategy and chose the municipality of Sorriso, in northern Mato Grosso, which is also a large grain-producing region.

“The Sorriso area and Mato Grosso in general are strategic for us. They will provide the raw material we need to produce ethanol and (corn) meal with the quality we seek,” said FS Bioenergia CEO Henrique Ubrig said in a statement.

The Sorriso plant will be larger than the first one in Lucas do Rio Verde. The investors project a production of 680 million l/year of ethanol, 500,000 tonnes of corn meal and 20,000 tonnes of corn oil. The plant is expected to process 1.8 million tonnes/year of corn.

The Brazilian government has subsidised the transportation of corn from centre-west states to markets in other parts of the country as a way to support prices and help farmers.

When the second plant is ready, FS Bioenergia projects that it will process 3.1 million tonnes/year of corn in Mato Grosso, which currently produces around 26 million tonnes/year of the crop.

The plants are will also offset the country's increasing demand for domestic ethanol, which can't be met by the existing sugarcane ethanol production.

Brazil began sugar cane ethanol production in the mid-1970s and today produces approximately 25% of the world's ethanol. Bank of America estimated that annual ethanol sales in Brazil could reach 13.5 billion US gallons in 2022, two-thirds greater than the 8.1 billion gallons estimated in sugar cane ethanol production in 2016.

The Mato Grosso region's substantial corn production – both proven and potential – make corn-derived ethanol the most viable option to complement existing sugar cane ethanol production and fulfill an annual multi-billion gallon shortfall.

Founded in 1990 by entrepreneur and agribusiness pioneer Bruce Rastetter, Summit Agricultural Group is a diverse farming, agricultural investment and farm management company headquartered in Alden, Iowa. Summit's diverse operations include successful row crop, beef cattle and pork farms in the U.S. and a growing presence in the South American biofuels market.

Headquartered in Lucas do Rio Verde, Mato Grosso, Fiagril is a diversified company whose operations throughout Brazil include biodiesel production, grain trading, crop production inputs and infrastructure development. Founded in 1989, Fiagril's commitment to sustainable agricultural development in Mato Grosso has served as a model for other regions of Brazil for more than 25 years.

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