Mato Grosso corn ethanol expansion faces biomass supply challenge

The rapid expansion of Brazil’s corn ethanol industry is creating a significant demand for biomass, posing a strategic challenge for the agribusiness sector. According to reports from Itaú BBA, Brazil’s corn ethanol production capacity is projected to grow from 10.9 billion liters in 2025 to 25.3 billion liters by 2030.

In Mato Grosso, the nation’s primary hub, production is expected to rise from 6.9 billion to 11.9 billion liters in the same period. This growth is constrained by a regulatory agreement between the state government and the Public Ministry of Mato Grosso, which mandates that the use of native forest biomass must be phased out by 2035. To ensure energy security, the state may need to plant approximately 218,000 to 407,000 additional hectares of eucalyptus by 2028, given the seven-year maturation period for the trees.

Estimates suggest that the necessary investment for these energy forests in Mato Grosso could range between R$ 7.6 billion and R$ 14.3 billion, depending on industrial efficiency and tree productivity. While eucalyptus is the primary focus, other alternatives such as bamboo, rice husks, and sugarcane bagasse may complement the supply.