Brazil's Corn Ethanol Plants Rely on DDG, Corn Oil for Survival

Corn ethanol plants in Brazil are struggling to stay afloat due to plummeting ethanol prices. According to a study by consulting firm Pecege, the average production cost of corn ethanol is R$2.75 per liter, while prices obtained by plants have fallen below that level in several states.

However, facilities that use corn as their feedstock are finding some relief from coproducts such as distillers dried grains (DDG) and corn oil. These products, primarily used in animal nutrition, are being sold for an average of R$0.73 per liter of ethanol produced and R$0.20 per liter of ethanol, respectively.

CerradinhoBio, Brazil's third-largest corn ethanol producer, has been maximizing corn oil extraction through technological and operational changes to generate significantly higher returns. The company sells a tonne of corn oil for between R$5,000 and R$6,000, while a tonne of DDG sells for R$1,000.