Monsanto Sorghum Seeds to Yield Brazil Ethanol During Cane Break

Monsanto Co. (MON), the world’s largest seed company, will sell enough sweet sorghum for 20,000 hectares (49,400 acres) of plantations in Brazil this year as sugar cane mills struggle to meet demand for ethanol and are seeking an alternative source of the renewable fuel.

The plantations may generate enough sorghum to produce 80 million liters (21.1 million gallons) of ethanol, said Jose Carramate, St. Louis-based Monsanto’s sugar cane leader.

Sweet sorghum, an 8-foot (2.4-meter) plant that resembles sugar cane and may yield 80 percent as much fuel, may become an alternative feedstock for Brazilian mills after a poor cane harvest forced some plants to close this month, more than a month early, for the annual inter-harvest break during the rainy season.

“This year will be the magic year,” as mills put the crop to the test, he said in a telephone interview yesterday. “We could see 100,000 hectares planted next year at the very least.”

Farmers will plant the sorghum in October on fallow land and harvest it as early as February when early season cane has low sucrose levels and produces little ethanol.

Monsanto is working with 20 mills, he said. The company will either sell the seeds or furnish them for free and take a cut of the profits, according to Carramate.

“This isn’t a replacement crop. It’s planted in addition to cane,” on land that mills clear each year to renew their plantations, he said.

Brazil clears and replants about 1.7 million hectares of cane plantations each year that may support sorghum crops during the inter-harvest period, he said.

Low Costs

Crushing sorghum stems and processing the juice into ethanol requires no modification to mills’ machinery, though some farmers have had difficulty planting the small seeds, he said. “The challenge here isn’t industrial but agronomic,” he said.

Sweet sorghum may provide mills with an extra $5 million of earnings before interest, taxes, depreciation and amortization a year, Bill Burnquist, general manager of U.S. seed company Ceres Inc.’s Brazil unit, said at a Sao Paulo conference Sept. 29.

Brazil, the world’s largest producer and exporter of sugar, will grow 588.9 million tons of sugar cane this year, down from last year’s 623.9 million tons, the country’s crop-forecasting agency Conab said Sept. 5.

“This is a great opportunity for sweet sorghum to offset part of the production gap,” Carramate said.

To contact the reporter on this story: Stephan Nielsen in Sao Paulo at snielsen8@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net