In this article, SA Canegrowers CEO Dr Thomas Funke argues that South Africa should focus on bilateral trade with its BRICS partner Brazil, not for imported sugar, but rather an exchange of technical expertise on biofuels and sugarcane diversification.

President Cyril Ramaphosa’s recent State visit to Brazil comes as conflict in the Middle East once again rattles global oil markets – a reminder of how exposed fuel-importing countries like South Africa remain to external shocks.

In that context, the most valuable outcome from the visit should not have simply been expanded trade in commodities. South Africa should have also used the occasion to pursue deeper cooperation with Brazil on biofuels and sugarcane diversification. As fellow members of BRICS, South Africa and Brazil have a clear opportunity to strengthen industrial collaboration by sharing the technical knowledge and policy experience that enabled Brazil to build one of the world’s most successful biofuel industries.

Brazil offers a powerful example of what diversification can achieve. While it remains the world’s largest sugar exporter, the country has spent decades building a sugarcane sector that extends far beyond sugar itself. Through ethanol blending mandates, stable policy frameworks and sustained investment, Brazil has become the world’s second-largest producer of ethanol.

Sugarcane mills in Brazil operate as integrated bio-refineries. They produce sugar when global prices are strong, but they divert cane into ethanol production when fuel markets offer better returns. Many mills also generate renewable electricity from sugarcane by-products and feed it back into the national grid.

Producers blend ethanol from sugarcane directly into petrol used in vehicles, reducing reliance on imported crude oil and helping shield domestic fuel markets from global price shocks. As a result, Brazil has built a more resilient sugarcane sector that contributes not only to agricultural exports, but also to transport fuel supply and national energy security.

South Africa has long recognised the need to move in this direction. The Sugarcane Value Chain Master Plan identifies diversification into biofuels and other value-added products as essential for the long-term sustainability of the sector.

Yet progress has been slow, as the master plan has yet to lead to any significant policy shifts that will be needed to enable this immense opportunity for green industrialisation and new job creation to take root in South Africa. At the same time, imports are placing growing pressure on the domestic sugar industry. Large volumes of refined sugar now enter the South African market from major exporting countries including Brazil, India and Thailand, displacing locally produced sugar.

The scale of these imports is devastating to the local industry. According to the South African Revenue Service data tracked by SA Canegrowers, January 2026 alone saw about 24 600 t of deep-sea sugar imports enter South Africa – more than the total annual imports recorded in each of the years 2020, 2021 and 2022. South Africa produces more than enough sugar to meet domestic demand. Imported sugar, therefore, does not fill a shortage but replaces locally produced sugar that would otherwise sustain growers, mills and rural economies. Sugarcane growers and sugar millers would both benefit in terms of long-term sustainability if biofuels were allowed to become a contributing revenue stream, helping to strengthen their bottom line and providing a buffer to absorb market shocks such as surges in imported sugar.

In this context, diversification into biofuels is an important weapon in the state’s arsenal to alleviate at least some portion of those shocks, whilst retaining existing farming and milling jobs and creating new jobs as the production of bioethanol creates demand for new skills.

Sugarcane ranks among the world’s most efficient crops for producing renewable fuels such as ethanol. By blending ethanol into petrol, countries can reduce dependence on imported fuel while creating a new domestic market for agricultural production. Similarly, using bioethanol to create sustainable aviation fuels locally could make South Africa the continent’s hub for global aviation, in a time when airlines are aiming to reduce their carbon footprints.

Countries like Brazil and India recognised this opportunity decades ago and built the policy and technical systems needed to support it – from blending mandates and fuel standards to integrated milling technologies and supply chains.

South Africa has the capacity to develop a similar model. What South Africa now needs is a policy that supports investment into these new technologies and access to the technical expertise from countries like Brazil to build a competitive biofuels industry.

Brazil has already demonstrated how sugarcane can support both rural economies and national energy systems. South Africa should now work with Brazil to bring that expertise home.