Brazil Corn Ethanol Surge Tightens Global Corn Supply

• Corn ethanol growth: Brazil’s corn-based ethanol production rose 12.26% year-on-year to 9.19 billion liters in 2025/26.
• Feedstock shift: Corn ethanol now accounts for 27.28% of total ethanol output, underscoring a structural move away from sugar cane.
• Total output softer: Overall ethanol production fell 3.56% to 33.72 billion liters, despite the expansion in corn-based capacity.
• Global market tone: Impact is neutral to slightly bearish for Black Sea corn, with Brazil absorbing more domestic corn and marginally tightening global coarse grain balances.

Brazil Corn Ethanol Market Update

Brazilian corn ethanol production reached 9.19 billion liters in the 2025/26 season, up 12.26% from the prior year, according to UNICA. The corn segment now represents 27.28% of Brazil’s total ethanol portfolio, highlighting rapid growth in industrial corn consumption.

In contrast, Brazil’s overall ethanol output declined 3.56% year-on-year to 33.72 billion liters, down from record volumes in 2024/25. The simultaneous rise in corn ethanol and fall in total ethanol production points to a structural shift in feedstock use, with producers increasingly favoring corn over sugar cane.

Impact on Global Corn and Feed Grain Markets

The expansion of Brazil’s corn ethanol capacity is absorbing larger volumes of domestic corn, which may gradually constrain exportable surpluses in coming seasons. This could provide marginal support to international corn price floors by tightening global coarse grain balances over the medium term.

For Black Sea exporters, the impact is assessed as neutral to slightly bearish. While reduced Brazilian export availability could improve competitiveness in some overlapping markets, Brazil and the Black Sea region typically serve different demand channels and seasonal windows, limiting the direct effect on Black Sea corn pricing.

Source: Market Data