Food and fuel
Food and fuel The example of Brazil
Marcos Fava Neves Mairun Junqueira Alves Pinto Marco Antonio Conejero Vinicius Gustavo Trombin
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ISBN 978-90-8686-166-8 e-ISBN: 978-90-8686-721-9 DOI: 10.3920/978-90-8686-721-9
First published, 2011
© Wageningen Academic Publishers The Netherlands, 2011
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Table of contents Introduction
11
1. The need for food and fuel production and the role of Brazilian agribusiness 1.1 The global economic/financial crisis 1.2 Food demand and food inflation 1.3 The road to addressing increased food demand and food inflation 1.4 Background and overview of Brazil’s agricultural production 1.5 The importance of agribusiness for the Brazilian economy 1.6 The scenario for TNC investments: trends and global issues
13 13 15 19 23 29 34
2. The sugar-energy value chain in Brazil 2.1 The sugar-energy supply chain 2.2 The sugar-ethanol evolution in Brazil 2.3 Mapping and quantification of the sugar-energy supply chain in Brazil 2.4 Pre-farm statistics 2.5 On-farm statistics: sugarcane production 2.6 Post-farm statistics 2.7 Facilitating agents 2.8 Managerial implications and discussion
41 41 48 54 56 59 60 66 69
3. Strategic plan for the sugar-energy value chain in Brazil 3.1 Introduction 3.2 An application of the CHAINPLAN method 3.3 Understanding 3.4 External analysis: opportunities and threats 3.5 Internal analysis: strengths and weaknesses 3.6 Objectives (goals) of the plan 3.7 Main strategies 3.8 Projects and decisions related to production, products, research, development, and innovation 3.9 Projects and decisions related to communication 3.10 Projects and decisions related to distribution and logistics 3.11 Projects and decisions related to training 3.12 Projects and decisions related to coordination and adequacy of the institutional environment 3.13 Conclusions
71 71 72 78 78 91 96 98
Food and fuel
99 101 102 103 104 105
7
4. An overview of FDI in the sugar-energy sector in Brazil and lessons learned 4.1 Characterisation of the largest groups in the sugar-energy sector 4.2 The institutional and regulatory framework 4.3 The growth strategies in the sugar-energy sector 4.4 The role of investment funds (private equity) 4.5 Financing (leverage debt equity) 4.6 Corporate social responsibility 4.7 Environmental regulations and trends
5. Concluding remarks – FDI: suggestions for regulations, public policies, and incentives 5.1 How to evaluate the capacity of international investment to generate the regional development 5.2 How to promote and regulate international investments 5.3 A strategy for international investments 5.4 Planning strategies for 2010-2020 5.5 Final discussion
107 107 109 111 112 123 124 125
127 127 128 132 134 135
References and websites
137
Annex 1. Most relevant M&A operations from 2007 to 2010.<