BRF FACES COMPETITION FOR CORN ETHANOL INDUSTRY

The brazilian BRF has faced growing competition for the supply of maize, the main raw material of the company, with the increased production of corn-based ethanol in the Midwest, said company President, Pedro Parente, this Wednesday (19). A relative said, during an event in Sao Paulo that the situation poses additional challenges for the company to ensure raw material for feed at reasonable costs. Corn ethanol is a relatively new trend in Brazil, but has had a rapid development in Mato Grosso State, which is the main producer of Brazil's grains and also one of the largest exporters. The company began using alternative ingredients for feed production, as dry beans by distillation (DDGs), a by-product of the manufacture of corn ethanol Rico in proteins. "We have seen an increase in the consumption of corn ethanol producers in Mato Grosso and Goiás, where they became relevant consumers of corn," said relative in a seminar organized by the broker and consultancy INTL FCStone, in São Paulo. The President of the BRF estimated that ethanol manufacturers were already using between 10% and 15% of the offer in those States, where the industry has processing plants and operates with chicken and pork producers. The Brazil is the second largest producer of ethanol in the world, behind only the United States, but traditionally produces fuel from sugar cane. New investments in the Midwest, however, are increasing the participation of ethanol produced from corn. Relative even said that preventing exports to Europe brought relevant problems "to the company's stocks in relation to cuts of chicken breast.