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Prospects for Biofuel Production in Brazil: Role of Market and Policy Uncertainties

In: Handbook of Bioenergy Economics and Policy: Volume II

Author

Listed:
  • Maria Paula Vieira Cicogna

    (University of São Paulo)

  • Madhu Khanna

    (University of Illinois at Urbana-Champaign)

  • David Zilberman

    (University of California at Berkeley)

Abstract

Biofuel production in Brazil has been motivated by a desire to reduce dependence on fossil fuels and encourage rural economic development. Policies and technologies over the past 25 years have lowered production costs and created profitable opportunities. The industry grew through political willingness to support an infant industry, continuous technological advances in both biofuel production and complementary industries (e.g., automotive), ability to utilize agricultural byproducts, and income growth in rural areas. It was confronted by the challenges of price instability due in large part to changing oil prices, uncertainty about the prospects of biofuels as a viable source of energy, the ability to create and maintain policies conducive to its growth, and, finally limited access to credit. This paper demonstrates the importance of political economy factors in the evolution of the biofuel sector in Brazil and suggests their importance to understand the evolution of this sector in other parts of the world.

Suggested Citation

  • Maria Paula Vieira Cicogna & Madhu Khanna & David Zilberman, 2017. "Prospects for Biofuel Production in Brazil: Role of Market and Policy Uncertainties," Natural Resource Management and Policy, in: Madhu Khanna & David Zilberman (ed.), Handbook of Bioenergy Economics and Policy: Volume II, pages 89-117, Springer.
    • Handle: RePEc:spr:nrmchp:978-1-4939-6906-7_5
    DOI: 10.1007/978-1-4939-6906-7_5
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    Cited by:

    1. David, S.A. & Inácio, C.M.C. & Quintino, D.D. & Machado, J.A.T., 2020. "Measuring the Brazilian ethanol and gasoline market efficiency using DFA-Hurst and fractal dimension," Energy Economics, Elsevier, vol. 85(C).
    2. Deepayan Debnath & Madhu Khanna & Deepak Rajagopal & David Zilberman, 2019. "The Future of Biofuels in an Electrifying Global Transportation Sector: Imperative, Prospects and Challenges," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 41(4), pages 563-582, December.

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