Posted by Poultry World editor, Richard Allison, in Brazil
When travelling across Brazil, the first thing that hits you is the scale of the country. It's roughly the size of Europe and in one state alone there is more than nine million hectares of extensive grassland ripe for cropping.
One option mooted is sugar cane for biofuel production. The sector is already planning to expand by at least 50% in the next four years.
So in the middle of my poultry schedule, I managed to catch up with Federique Rose e Abreu, the government official responsible for co-ordinating the Brazilian biofuel sector. I wanted to find out whether this expansion would have an impact on UK feed prices via soaring world grain prices.
The UK livestock sector has already felt the consequences of the US biofuel sector swallowing up ever increasing amounts of corn.
However, it soon became apparent that the Brazilian approach will have a minimal impact on poultry feed prices. In fact, the Brazilian approach with sugar cane seems to make more sense than using corn, particularly with land availability being a limiting factor in the US and EU.
With sugar cane, it's possible to produce 7000 litres of ethanol/ha while maize only yields 400 litres/ha. And on top of this, the Brazilians use the left over fibre as a fuel to heat the mixture for distillation. In contrast, US plants rely on fossil fuel. The result is that ethanol production from sugar cane is four times more energy efficient than from corn.
To conclude, the threat to feed prices seems minimal. However, I believe the real long-term threat is to the fledgling EU bioethanol sector. Following on from chicken and beef, could this be the next EU market that Brazilian farming targets?