Brazil permits first wheat-based ethanol plant, widening grain use in biofuels
Projected annual output is expected to reach up to 12 million litres of hydrated ethanol.
BRAZIL – Brazil has taken a further step in diversifying feedstocks for biofuel production after the Brazilian National Agency for Petroleum, Natural Gas and Biofuels (ANP) issued a permit to launch the country’s first wheat-based ethanol plant.
The facility is located in the municipality of Santiago, in Rio Grande do Sul state, a region traditionally associated with grain production and cereal-based agribusiness.
According to a report by Brasil 247, a partner of TV BRICS, the plant will initially be capable of processing around 100 tonnes of wheat per day.
At this stage, projected annual output is expected to reach up to 12 million litres of hydrated ethanol.
Construction investments totalled approximately US$18.6 million, reflecting growing private sector confidence in alternative cereal-based biofuel pathways.
The project has been designed with expansion in mind. By 2027, the plant’s capacity is expected to increase to between 45 million and 50 million litres of ethanol per year.
To support this scale-up, an estimated additional investment of around US$93 million may be allocated. If realised, this would place the facility among the more significant grain-based ethanol operations in southern Brazil.
The project became possible after the company obtained a state operating licence from the government of Rio Grande do Sul in November last year.
Regulatory approval at state level has been a key prerequisite, particularly given the plant’s use of wheat, which has not previously been processed for fuel ethanol in Brazil on an industrial scale.
The launch of the plant expands the list of agricultural crops used in Brazil for biofuel production, which has historically been dominated by sugarcane, with corn ethanol gaining momentum over the past decade.
Rio Grande do Sul is one of Brazil’s main wheat-producing states, and the emergence of industrial demand from the biofuel industry could offer an additional outlet for domestic wheat, especially in years of surplus production or price pressure in food and feed markets
Brasil 247 reported that financing for the biofuel sector in Brazil has reached a record level. In 2025, the Brazilian Development Bank (BNDES) approved loans worth US$1.1 billion for bioenergy projects, the highest level since 2010.
Priority areas for financing include ethanol production from corn and wheat, as well as biomethane projects, underlining the government’s focus on expanding renewable energy while strengthening agricultural demand.
Sign up to HERE receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.
