By Brazil Stock Guide – Brazil’s BNDES approved 500 million reais in financing for FS to build a new corn ethanol plant in Campo Novo do Parecis, Mato Grosso, expanding the country’s capacity to produce biofuels from one of its fastest-growing agricultural regions.
The project has a total estimated cost of 2.07 billion reais, with the development bank’s financing covering 24.2% of the investment. The operation will use resources from the Climate Fund and BNDES Finem, a credit line aimed at food and biofuel production.
The plant is expected to process as much as 1.2 million tons of corn a year and produce up to 540 million liters of ethanol annually. It will also generate an estimated 390,000 tons of DDG, or distillers dried grains, a byproduct used in animal feed.
FS already operates three plants in Mato Grosso, located in Lucas do Rio Verde, Sorriso and Primavera do Leste. The new unit would further consolidate the company’s presence in Brazil’s leading corn-producing state.
BNDES President Aloizio Mercadante said the transaction supports Brazil’s push to expand ethanol output and cut emissions while also stimulating domestic manufacturing.
“Besides contributing to the advance of our ethanol production and to the decarbonization of the economy, this is an operation that, following the industrial policy of President Lula’s government, also boosts other sectors of industry, since significant amounts of the project will be invested in domestic equipment,” Mercadante said.
The construction phase is expected to create 3,000 direct and indirect jobs. Once the plant is completed, it is projected to generate 182 direct jobs and 323 indirect positions.
The project also includes a second stage aimed at expanding operations. Under that phase, processing capacity could double to 2.4 million tons of corn a year, while annual ethanol output could reach 1.08 billion liters.
The location is strategic for FS, according to BNDES, because the company’s operations are concentrated in one of the world’s fastest-growing regions for second-crop corn production. Mato Grosso accounted for 38.6% of Brazil’s corn output in the 2022-2023 crop year, according to data from the Agriculture and Livestock Ministry cited by the bank.
Founded in 2014 and headquartered in Lucas do Rio Verde, FS was the first company to produce corn ethanol in Brazil. It is currently the country’s second-largest producer of corn-based ethanol and also generates revenue from animal nutrition products, corn oil and electricity.