AGRICULTURAL PLANNING: THE SECRET BEHIND BRAZIL’S ETHANOL SUCCESS

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By Marcelo A. Coelho

An old Brazilian saying goes, “Toss a seed into the soil and it shall grow”.

Thirty years after the inception of Pro-Alcool, Brazil’s federal ethanol program, agricultural techniques have advanced by large strides, making the planting of feedstocks a very precise science. It is no longer sufficient to throw a seed into the ground for it to sprout, as had been the case since Brazil was discovered by the Portuguese in 1500.

When contemplating plans for establishing an ethanol-producing industrial unit, other elements now come into play: sugar-producing capacities, energy sources, carbon credits, yeasts, fine chemicals, and biodiesel production – all of these are complementary, self-reinforcing elements that have to be assessed as a whole when selecting the right land for industrial development.

Logistics issues (side roads, highways, railways, access to ports, etc.), water systems (sources, rivers, lakes, or any spring on a farm property), soil analysis (chemical and physical properties of the soil), and terrain (topography), climate and precipitation characteristics, in addition to Brazilian legal constraints regarding the environment, are all factors that determine whether a certain property is right or not for a given project.

Once this information has been assessed, and any necessary adjustments have been made, then the “Agricultural Plan” may be drawn up. The Plan contemplates the harvesting schedule, agricultural equipment, reaping methods (mechanized or non-mechanized), the different types of sugarcane to be planted, the development of seedbeds, labor requirements (amount, sourcing) – all these items are taken into consideration.

The Agricultural Plan allows investors to calculate the requirements for milling equipment (at present and in future expansions), and, as a result, the scale and scope of distillation and co-generation equipment (distillation columns, conveyor belts, choppers, tanks, sugar driers, turbines and cauldrons, activating mechanisms, etc.), as well as of output (fuel ethanol, neutral ethanol, sugar, yeasts, etc.).

In short, the Agricultural Plan and the studies that precede it are the most important item of a business plan in the sugar and ethanol industry. They also substantiate other items, such as industrial and operational plans, human resources, market analyses, marketing studies, product assessments, financial plans, environmental issues, and social responsibility projects.

In Brazil, a few companies stand out in the execution of these preliminary studies. One of them is Marchini do Brasil, which has operated out of the city of Ribeirao Preto, interior of Sao Paulo state, for over thirty years.

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