Isolated and Without Food in Brazil's Corn Ethanol Capital


Why Is Brazil’s Climate Fund Giving Hundreds of Millions to Big Ag?

In 2015, Bruce Rastetter was at the height of his political capital.

So we thought it made sense that we ought to have a discussion. We ought to ask those questions. We're hopeful for answers.

 The summit was put on by a man named Bruce Rastetter, a wealthy Republican donor who made his money in agribusiness and who wanted to quiz potential presidential candidates about ag policy.

That was NPR’s Tamra Keith with a story about the Iowa Ag Summit, an event Rastetter created. Politico, NBC, The Atlantic and a whole host of local Iowa media covered it, too. Lots of those stories referred to Bruce Rastetter as a “Republican kingmaker” in the state…and you could see why: The event consisted primarily of Republican candidates being trotted out on stage, each for the same amount of time, each asked the same questions, always by Bruce Rastetter.

(0:42.2) Nine potential candidates showed up. All Republicans each got 20 minutes on stage before an audience of hundreds and a whole riser full of cameras. They were answering sometimes wonky questions from Rastetter about farming, wind power, immigration, trade, and the big one.

 (1:09.2) Let's talk about the RFS renewable fuels Next subject, the RFS. You've been an unabashed support of the RFS. Yeah. Why?

If there was any question about the overriding viewpoint of the Iowa Ag Summit looked no further than the giant foam fingers. One sponsor passed out. They read renewable fuels number one.

At the time, Rastetter was backing former New Jersey governor Chris Christie as the Republican nominee for president. In 2016, as it became clear that Trump would be the frontrunner, he joined Trump’s Agricultural Advisory Committee.  There was even talk at the time of Rastetter being named Trump’s Secretary of Agriculture.

Meanwhile, his efforts in Brazil were going well, too. He’d closed on the farm in Mato Grosso with the Franz brothers, and plans for their first Brazilian ethanol plant were underway.  Just a few months after his Iowa Ag Summit in 2015, Bruce was back in Brazil doing more land tours, this time up in the Amazon, in Amapá, which travel bloggers love to describe as “the most isolated state in Brazil.”

 Welcome to Brazil's most isolated state. I’m in Amapa, nestled deep in the Amazon, the north of the country.

 O Amapá é o estado mais isolado do Brasil. 

Aqui é a única unidade da federação que não tem nenhuma estrada que conecte com outros estados do Brasil. Tudo que chega aqui no Amapá ou vem por rio ou vem de avião.

Bruce was in Amapá to do business. He told a local paper at the time that the location of the state, at the mouth of the Amazon with direct access to the Atlantic, made it a perfect spot for agriculture. And it was in easy reach of markets beyond Brazil.

So Bruce and his partners bought a plot of land in northern Amapá and started farming. His business partners wasted no time getting into the shipping port business up there too, so they could export corn and, eventually maybe even corn ethanol.

By 2020 Bruce’s Brazilian company, FS, had 

ethanol plants up and running in Mato Grosso. In 2021 announced his big carbon capture pipeline project–the Midwest Carbon Express—in Iowa, and by 2023 FS had 

 ethanol plant in Mato Grosso. For years there, everything was coming up Bruce. Until it wasn’t…

I’m Amy Westervelt and this is Drilled season 15: Carbon Cowboys, a collaboration with the Intercept Brasil to tell the story of how the ethanol kingpin of Iowa brought corn ethanol to Brazil,

After the break, the cracks in the plan for global carbon domination…

Like you heard in episode one, we first started looking into this story not because of anything that happened in Brazil or Iowa but because of something incredibly wonky: carbon capture and storage. Again, this is the idea that the carbon dioxide emissions from things like power plants, refineries and factories can be captured, and either reused in some way or stored. Specifically, I thought I must be missing something because some very smart people seemed to think it was a great idea for dealing with carbon emissions, but to me, the math wasn’t mathing.

It sounds good at first, I know. Just put the stuff back where we got it! It comes out of the ground, right? So strip the bad stuff out and shove it back down there, problem solved. After all, the problem with fossil fuels is really just their emissions, so if we can shove those underground, we’re good. Sort of like how men deal with feelings.

This of course ignores all the other environmental and health issues that come with drilling, refining and burning fossil fuels. But even if we agree to ignore air pollution for a minute, the more you think about carbon capture, the less sense it makes.

First off it’s a gas…famously a substance that doesn’t stay put. And in fact, projects all over the world have struggled to keep it stored.

Then, it’s pretty inefficient. The models that paint it as a great solution to climate change assume it will capture 90% or more of emissions. In reality it’s more like 50 to 70% And remember we’re just talking about emissions generated at a power plant or industrial facility, so best case carbon capture could deal with around 5 percent of global emissions…but we don’t have enough storage capacity for that much. Finally, carbon capture requires equipment to capture the carbon and then pipe it somewhere to be stored, even if that storage tank is close to the facility. That all requires energy. Sometimes a lot of energy. Usually fossil energy, so you have a whole other set of emissions.

Mark Jacobsen’s an engineering professor at Stanford University, and a vocal critic of carbon capture. He did a whole study on just this problem of the energy required to power carbon capture, it’s called “the energy penalty.”

 in the case of coal,  I mean, that energy penalty is large. It's on the order of 25 percent of the

 energy from the coal plant. So  if you get the energy from coal, you need 25 percent more coal.  And you'll, as a result, you'll have 25 percent more air pollution from the coal emissions  and you need 25 percent more coal mining as well.

Jacobsen did his study on an actual functioning carbon capture plant. Although, like a lot of others, it did close after a few years of operating.

it was in Thompson, Texas. And it was called Petra Nova. And they added- to a part of the coal plant–they added a carbon capture equipment. It cost 1 billion and  Instead of actually getting the energy from coal, they built a natural gas plant  just to provide the electricity to run the carbon capture equipment for the coal plant.  And so they had to now mine gas and pipe the gas to the gas plant, burn the gas. None of the gas emissions were controlled or captured,  so you had air pollution from the gas. You had carbon dioxide from the gas.  And the overall efficiency of the capture equipment was not very good. It was like 55% in the first year.

The plant was using so much extra energy on carbon capture, and it still was only capturing a little more than half of the carbon dioxide from the coal.

It was like, 55 percent in the 1st year  of the capture efficiency from the coal plant of the equipment.  And  then on top of that,

 they build a pipeline system and they use that carbon dioxide they did capture, they transported it to a nearby oil field and they  got more oil through a process called enhanced oil recovery.

Ah yes enhanced oil recovery, injecting compressed CO2 underground to get more oil out. Turned out, oil companies had been using carbon capture since the 70s, not to deal with emissions but to optimize oil production.

 about   percent of all carbon dioxide captured in the world is used for enhanced oil recovery. So, it gets you more oil and during that process of enhanced oil recovery, 40 percent of the CO2 is released straight back to the air.

Jacobson said by the time he accounted for that plus the emissions generated powering the carbon capture equipment at PetroNova, it was maybe capturing around 7 percent of the coal plant’s emissions…but that didn’t account for all the new air pollution created by powering the carbon capture equipment.

As natural gas became more common, oil companies had to learn how to separate carbon dioxide from it and do something with it, too. Carbon capture to the rescue once again. So, the oil and gas industry had figured out how to use a waste product to get more oil out. How the heck had this been rebranded as a climate solution?

It was in trying to answer that question that I met Carolyn Raffensperger. You heard from her a bit earlier in the season, too, she’s the executive director of the Science & Environmental Health Network and lives in Iowa. She’s the one who first told me about Summit’s carbon pipeline project in Iowa, the one that got Bruce Rastetter so much pushback.

 (09:23) a pipeline company in Iowa called Summit Carbon solutions has solicited permits in multiple states and just been given a permit by the Iowa Utilities Commission. you had the John Birch Society and the Sierra Club, you know, saying, no, you're not gonna do this. And they gave permission even knowing that the CO2 pipeline rule had not been finalized.

The strange mix of opponents to the pipeline was fascinating, as was the fact that someone as prominent in Republican politics as Bruce Rastetter had somehow not realized that people would get mad if their property rights were threatened. Kory Melby, our American ag consultant in Brazil, had thoughts on that too.

 the irony when you think of how conservatives of the past–pro constitution, land rights. Property rights were, were, were sacrosanct. You know, they, they would die on the cross for that, but as soon as it Oh, it goes against their pipeline. Oh, no, no, no, no. We look at why not? No, no, no. You see, it just, we're not, they're, they're not conservatives anymore, either They're businesmenses, period. You know? [laughter]

But it wasn’t just Libertarian property owners who objected to this approach. Almost as soon as the Midwest Carbon Express was announced, many of the same networks that had fought against the Dakota Access Pipeline mobilized quickly to fight Summit in both Iowa and the Dakotas.

 a lot of stuff that took time to figure out during Standing Rock was kind of just implemented right away. people that have worked together in the past easily got together and had conversations.

This is Sikowiss Nobiss, an Indigenous activist and founder of the Great Plains Action Society, speaking to Drilled reporter Alleen Brown in Iowa earlier this year.

 there's a great network of people that's been created. Because of Standing Rock.  Well, I don't wanna just say Standing Rock.  Like there's a great network of people that have been created because of the fight here in Iowa. I don't feel like people talk about that ever. Like there, the majority of the pipeline goes through Iowa. The fight started in Iowa in 2014.

In the fight against the Midwest Carbon Express, they were suddenly joined by people who had been vehement opponents to the Standing Rock movement.

(04:25)  it's actually become, uh, one of the, one of the extremely few issues in Iowa that brings Republicans and Democrats together to like, to stop the pipeline.

That has of course also created some tensions, because it’s not just landowners who are worried about how carbon capture infrastructure might impact them.

  This whole thing from the beginning has been so racialized and also based on class. Here in Iowa, they, they did these, 

meetings where in the counties where the pipelines are going through and um, you know, they did them at nine o'clock on a fricking Wednesday morning.

Nobiss says many of the big environmental groups fighting the Summit carbon pipeline have focused on the white, land-owning farmers. So she and other environmental justice advocates have focused their efforts on everyone else.

 even though  this pipeline's gonna go by a town that has like tons of rentals, tons of bipoc people like, um, they're not having conversations with them.

She’s been working to make sure that everyone in the pipeline’s pathway is informed.

When the Midwest Carbon Express pipeline was announced in 2021 it was due to be operational by 2024. As of this episode’s publish date, it has not even started construction. And that’s not the only problem Bruce is facing back home.

Though he endorsed Trump in both his presidential campaigns. , Bruce Rastetter also publicly voiced concerns over Trump’s approach to trade policy, particularly tariffs, And sure enough, Trump’s tariffs have been tough on American farmers.

In tonight's Eye on America, farmers caught in the middle of a trade war…

President Trump has promised a new bailout for American farmers, as much as $13 billion that he said would be paid for by the tariffs.

We're gonna take some of that tariff money that we made, we're gonna give it to our farmers, who are, for a little while, going to be hurt until it kicks in, the tariffs kick in to their benefit.

Farm bankruptcies this year are surging. As of June, 55% more filed for bankruptcy compared to the previous year to year period. Many are now taking their frustrations directly to Republican lawmakers at town halls across the country.

I'm about ready to lose my farm. I am pissed, and I'm pissed at you.

And that goes double for an American farmer that happens to also be in the agriculture industry in Brazil.

If you’re not an ethanol producer in the US or Brazil, you probably don’t know that ethanol has become a key lever in an ongoing trade dispute between the two countries.  The chances of Bruce Rastetter not knowing are very slim.

The tension is only increasing as farmers on both sides look to cash in on the lucrative and growing sustainable aviation fuel industry, where Brazil currently has an edge because of how it grows its corn. Remember we mentioned “second crop corn” earlier in the season? Brazilian farmers plant soy, then corn, which means they aren’t adding to the amount of farmland to grow corn. That means their emissions are lower, even without using carbon capture. Here’s Daniel Lopes, VP of sustainability 

 O etanol de milho americano ele não zera, de fato. Então, eu acho que muitas vezes, relatórios como esse que você falou, quando eles falam do etanol de milho, eles estão olhando para os Estados Unidos e não para a realidade do Brasil que é diferente.

U.S. corn ethanol doesn’t actually achieve net-zero. So, I think that often, 

when they talk about corn ethanol, they’re looking at the United States and not at the reality in Brazil, which is different. [08’29’’]

Even before the debate over whose corn ethanol is greener, for decades US farmers have complained that the US tariff on Brazilian ethanol is super low–less than 3 percent– while the Brazilian tariff on US ethanol is around 18%. If you’re an ethanol guy with business in both countries, this is not a problem, you can win on both sides. But for farmers on one side or the other, it’s a long-standing battle.

Tim Sahay, who runs the Net Zero lab at Johns Hopkins University says this is just the latest tension between farmers in the two countries.

agro-industry, you know, it doesn't just feed America. Um, it is a huge exporter to the rest of the world of soya, of corn, of beef.  and the question for that American agro, agro industry was always how do we feed the world?  And when you think about feeding the world, there's one country. Uh, which is the most populous country in the world in Asia, where people are getting richer and they want to eat more meat And so that country is China. So for almost all of the 20th century, the question of who feeds China was front and center for American farmers.

He says in the 1990s, American senators from farm states, and ag executives were constantly going to China or hosting Chinese businessmen in the U.S., building a trade relationship, especially around soy and beef. But they weren’t the only ones.

 it turns out an almost identical set of relationships were being formed between agribusiness in Brazil and China.

And guess what, folks, it comes back, once again, to pigs.

 so the way sort of beef is absolutely essential to American sort of ideas and American frontier. And what does it mean to have prosperity? Well, you know, you, you have a steak every Sunday and that's very similar to the Chinese idea of having enough pork.  And then what do pigs eat? Well, they eat, crush, they eat animal feed and they eat soya.

Corn and soy. So American farmers and Brazilian farmers have been wrestling for the Chinese corn and soy market since the 90s. Although Sahay says they have sort of a love-hate relationship, where they compete, but they also respect each other. American farmers envy the amount of land still left to develop in Brazil, and Brazilian farmers look wistfully at what seems like more high-tech farming in the U.S.  Ethanol became an extension of that.

 So there's this way in which both Brazil and the US are sort of, again, finding themselves sort of frenemies  in the same way that they were frenemies with, um, who feeds China. You know, it's like, who's going to feed jet fuel to the world?

In 2025, Trump used the imbalance on ethanol tariffs as one of his justifications for a sweeping tariff campaign against Brazil that was driven largely by his support of ousted Brazilian president Jair Bolsonaro.

 President Trump has sent out 22 letters so far this week, setting tariff rates for different countries. One of those letters is not like the other. That's the letter that he sent to Brazil, which isn't so much about the economy as it is about politics and the president's own grievances with that country. President Trump complains about the fact that Jair Bolsonaro, conservative, Trump Ally, former president of Brazil is on trial there for an attempted coup back in 2022. Trump calls that a witch hunt and the President complains about Brazil's social media laws in this letter. Only after that does he get to the economic arguments that are supposed to be the basis of these tariffs, saying that Brazil has been treating the US unfairly,

Trump threatened a 50% tariff on all goods, and implemented a 40% one in August 2025. The Office of the United States Trade Representative–basically the trade arm of the White House–also launched a formal investigation into Brazil's trading practices, specifically citing poor market access for U.S. ethanol exports as a "long-standing bilateral trade irritant."

That’s bad news if, say, you’re building a Sustainable Aviation Fuel refinery in the Gulf of Mexico, perfectly situated to receive Brazilian ethanol imports, and you happen to also own a company in Brazil that produces corn ethanol.

Worse news: the Brazilian government has shown a willingness to offer up ethanol as the sacrificial lamb for reducing beef and coffee tariffs. Analysts said this could flood the Brazilian market with cheap US ethanol, a big problem for the producers in land-locked Brazilian states…like Mato Grosso. Nooooo.

And then at the last minute, amidst rising food prices and declining approval ratings, Trump rolled back the tariffs on Brazil in late 2025.

 the White House appears to be responding to growing frustration among consumers and voters on the issue of inflation and the cost of food. The president announcing late yesterday that he's rolling back tariffs on additional imports from Brazil, including fruit, coffee, cocoa, and beef.

BUT then he turned around and put blanket tariffs on everyone for everything. Less than the initial threat but still around 3 times what they were paying before, which effectively does away with the idea of importing “cheap” Brazilian ethanol to make sustainable jet fuel in the United States.

Now, things are in limbo on the trade front. The White House’s investigation into Brazil’s trade practices is still ongoing, the tariffs are embroiled in court battles, and who knows what Trump might announce next. Meanwhile, the US-Israel invasion of Iran has driven up demand for ethanol both within Brazil and beyond. Brazilian President Lula Da Silva has once again been talking about Brazil as the “Saudi Arabia of biofuel.”

Here in Germany, using a German-made truck and with the help of a German technician, we were able to prove that our biofuel is the most extraordinary fuel in the world, because it produces 90% less CO2 emissions. It reduces CO2 by 67 to 90 percent. That’s why I said yesterday that Brazil is preparing to become the Saudi Arabia of biofuel.

 and um, you know, to, to be the Saudi Arabia is like, you produce a lot, but you don't consume a lot. Therefore, you, you are gonna be the biggest exporter. And that just ends up coming out from the fact that Brazil has a huge amount of land.

The thing about these market-based climate solutions is that they’re quite vulnerable to…well, market forces. And tariffs aren’t the only thing out of Rastetter’s control at the moment. There’s also the situation with sustainable aviation fuel.

Brazil is going for it in a big way, but the U.S. under Trump is not so sure. Some of the incentives that were there when Bruce announced his Texas sustainable aviation fuel refinery: Summit NextGEN are either gone or not quite as good anymore. And Brazil faces an uphill battle getting European buyers for corn ethanol-based Sustainable aviation fuel because it’s known to have higher emissions than other types of ethanol. For FS, success as a Sustainable aviation fuel supplier rests entirely on the way Brazil grows corn: the second-crop thing again. Here’s Kory explaining what that means.

 We're in Brazil, you know, we can blame the cows, we can blame the soybeans, blah, blah, blah. You know, chicken or the egg water, does the deforestation come from? Right? Well, of, of course, corn is the second crop, so Brazil corn kind of gets a pass. So to speak.

The land has already been cleared. It's got soybeans on it. You, that's the first crop. Right? That's what's given the carbon. Weight. Oh, soybeans, heavy carbon weight.

This is important for sustainable aviation fuel because second-crop corn, by virtue of coming second, gets a lower carbon score than regular old corn. So whereas in the US farmers have to tap into carbon capture to lower their score, in Brazil, if they use second crop corn, it already starts out lower. Then adding in carbon capture only sweetens the deal. FS hasn’t started doing carbon capture yet, it’s still building its pilot project, but it’s already marketing the idea of “negative emissions” ethanol. Here’s Lopes talking about it at last year’s UN climate summit in Brazil:

 As far as I'm concerned, this is probably one of the, the one of the few very advanced BECCS projects in the southern hemisphere of the world…  generating the first, uh, global, uh, carbon negative ethanol in the world, 

which I think is, uh, is gonna be a, a protagonist on energy transition.

That word he used there, BECCS? That stands for bioenergy with carbon capture and sequestration. It’s the thing the fossil fuel industry is marketing these days as the way we can just keep burning fossil fuels while dealing with emissions. Capturing emissions from power plants and industrial facilities just hasn’t worked out. But they have positioned BECCS as something that doesn’t just reduce emissions, it actually removes them. On paper, this gets described as “negative emissions” technology…something that can actually remove emissions from the atmosphere because you’re growing plants, which absorb carbon dioxide, and then you’re turning them into fuel but not emitting anything, because theoretically you’re capturing all the emissions along the way. Whether all this stuff that looks great on a spreadsheet or in a model actually translates to less emissions in the atmosphere is a whole other question and one that businessmen aren’t concerning themselves with.

 “green,”. But then Kory said something that didn’t add up

 okay, so you said that the soybean has gone up like, you know, say 1.5 x and um, and corn four.

Does that mean that some of the corn is not second crop then, or is it a different crop that they're doing second crop corn with?

Uh [long pause]  it is a very valid question. [chuckle]

So maybe some of the second crop corn is actually first crop corn and we have no way of knowing? Once again, it all depends on the market.

   Corn became king in 2023, so yes, if you were within a 10 20 mile radius of an existing ethanol mill in Marco Grosso, um, there, they would take a portion of their farm because the bid for getting new crop corn as quickly as possible, they did plant first crop corn. They did corn. Corn, they planted a first crop corn, and the harvest of that went right to the well. And then came behind with a second crop corn. Right? Uh, that, that happened one year. Depending on the bid, it's possible we'll see first crop corn again planted in a few spots going into 2026. it is possible because quite frankly, 

if you could grow 150, 60 corn at 40, that trumps no pun intended, uh, soybeans at 60 sacks, at a hundreds reias a sack.

 Corn can absolutely be the better net market. you'll see first crop corn expand in Brazil. Definitely for the next crop year

Kory, the Brazil-based ag consultant, says that’s all down to ethanol. In other words more and more land is being converted to corn to supply the ethanol market. That’s worth thinking about if you’re trying to determine the environmental benefit of corn ethanol, because as you heard in episode 3, it’s connected to high pesticide use and land grabbing. Sustainable aviation fuel can be made from lots of other things–different types of biofuel and waste cooking oil, for example. It is considered a solid climate solution by a lot of folks, primarily because there’s not currently a great alternative for air travel.  As Sahay once put it to me plainly, "Biofuels in cars, bad. Biofuels in planes, good."

:  currently we use a lot of fuel and cars that we absolutely do not need to use anymore because of this sort of electric technology revolution that has happened with electric cars.

Here’s Tim Sahay from the Johns Hopkins Net Zero Lab again.

they're getting cheaper than internal combustion engine cars, which basically has meant that for the first time in a hundred years, oil use is not going up and up and up. It's starting to go down and down and down. So 2018 was the last year where internal combustion engine cars peaked. 

Since then, there's been fewer and fewer and fewer sales of internal combustion engine cars, and they've been displaced by electric vehicles and hybrid vehicles. 

And so why am I saying all of that? Well, basically it means that the market for gasoline is going down, down, down.

Sahay advises various governments on industrial transition–as in…if we’re going to get off of fossil fuels, what exactly does that look like for my country’s entire manufacturing sector? He says for Brazil, the biofuels industry is so large, they’re effectively blocking electrification of vehicles.

 the Brazilian auto industry. Yeah, became a completely unique island of an auto industry in the world where the Brazilian cars are the only sort of country in the world that, you know, run on what they call flex fuel engines. So you can chuck in gasoline in them, you can chuck in, ethanol in them, and they just work. And you can chuck in 50, 60% ethanol in them and they still work.

Transcription

With the sustainable aviation fuel industry set to explode, carbon capture has thrown the corn ethanol industry a lifeline...but what does another corn ethanol boom mean for everyone else?

. You can get the show in Portuguese on their feed as well!

False Solutions and Climate Delay

S15, Ep6 | A Tipping Point