With almost 500 years of history in Brazil, the bioenergy sector is positioned as one of the most important in the national agribusiness. It is a chain that involves around 350 production units, 70 thousand rural suppliers and more than 2 million direct and indirect jobs. Despite this condition, the success of this industry brings with it additional doses of responsibility in the face of the changes expected for the coming years, essentially guided by the need to expand, in an efficient and sustainable way, the supply of low-carbon food and energy.

In the case of sugar, the sector is responsible for around 45% of world trade in the product. This demand is essentially centered on low-income countries, where the product is significantly positioned as a competitive and affordable source of energy for regions with still low calorie consumption.

In this area, in addition to the need for constant improvement in the conditions of infrastructure, productivity and costs in the country, it is necessary to deal with changes in global geopolitics that should guide part of international trade in the coming years. The reduction of tariff and non-tariff barriers (technical, sanitary and bureaucratic, for example), in addition to the distorting measures adopted by several producing countries to facilitate exports, are also adversities to be overcome.

In the field of energy, in turn, the sector has consolidated itself as the main renewable source in the Brazilian matrix, accounting for more than 16% of the entire energy supply in the country. This condition was achieved without prejudice to the rational use of natural resources or food production. Despite this privileged condition, the transformations underway worldwide will require the ability to adapt and a concentrated effort from public and private agents working in this chain.

Particularly for the sugar-energy sector, the approval of RenovaBio and its effective regulation established a new milestone for the materialization of the potential of biofuels as clean energy in the coming years. Added to this scenario is the recent approval of Constitutional Amendment 123, of July 14, 2022, which incorporated, in the environmental chapter of the Brazilian Constitution, the maintenance of a tax regime that establishes a competitive differential for biofuels that compete directly with fossil substitutes.

The framework structured by RenovaBio and by Constitutional Amendment 123 of 2022, associated with the maintenance of more stable rules for pricing derivatives domestically, are fundamental for the expansion of ethanol production. Still in the institutional field, it is necessary to work so that public policies aimed at mobility are guided by technological neutrality, by the assessment of greenhouse gas emissions in the life cycle and by guidelines that fully explore the concept of sustainability in its economic aspects, social and environmental.

In the same vein, the consolidation of Decarbonization Credits as a mechanism to offset greenhouse gas emissions and their connection with eventual regulated carbon markets need to be explored and can offer an exceptional opportunity to value the positive externalities generated by the renewable energy produced. by the sector.

In addition to these efforts to maintain an adequate institutional environment, the success of the sugar-energy sector will essentially depend on the consistent work of producers to offer new energy sources and increase production, economic and environmental efficiency, of those currently manufactured.

Some examples in this area include: 1) innovations in the integrated management of sugarcane pests and diseases, such as expanding the use of biological agents and enhancing the natural control of pests with greater natural diversity in the production landscape and others; 2) by optimizing and improving the companies' internal logistics; 3) by new techniques and control procedures in the industrial process; 4) the adoption of precision agriculture tools and artificial intelligence to monitor crops and digitize operations; 5) by launching varieties more adapted to the production system, including the use of genetic engineering techniques; 6) through the use of differentiated planting technologies, such as the use of pre -sprouted seedlings and the signaling of technological rupture in the face of the development of artificial sugarcane seeds; 7) by new cultivation techniques aiming at greater retention of carbon in the soil; and, 8) the greater importance of training and human capital development.

In this context, it is worth highlighting the importance of consolidating bioelectricity and the manufacture of new energy sources, such as second-generation ethanol, biogas and biomethane. These products intensify the systemic vision and the addition of value to the sugar-energy industry from the use of by-products of the process, strengthening the concepts of circular economy throughout the chain.

It is also necessary to highlight the importance of the revolution observed in recent years with the expansion of ethanol production from second crop corn in Brazil. The integrated system implemented especially in the Midwest made it possible to expand second-crop corn, increase the supply of ethanol and strengthen the meat chain through the sale of by-products from the manufacture of ethanol as animal feed.

In the medium term, initiatives for the use of bioenergy carbon capture and sequestration systems and the use of the sector's products in the manufacture of green hydrogen should be added to these elements. These different possibilities can create new routes for the industry to act in the face of the need to adequately address the urgency in responses to the planet's climate change, which will require multiple, complementary options adapted to each region of the globe.

Finally, the sugar-energy chain needs to work on the challenge of communicating its advantages, positioning itself in a technically grounded manner and with language appropriate to the different audiences in the markets in which it operates in Brazil and abroad. From all the above, it remains evident that the coming years will be a lot of work for an industry that, throughout its history, has shown, on several occasions, the ability to reinvent itself.

The new challenges of offering food at competitive prices and the green economy will require optimized production systems, with cleaner technologies, practiced in a landscape of greater natural diversity, with greater use of by-products, opportunities for innovation and stimulation of new processes, products and business models. Taking advantage of the opportunities envisaged in this scenario will require articulation and alignment of all agents in the sugar-energy chain, in a joint effort with the public sector, to position the country as a competitive producer of food and clean and renewable energy.