“Hard work and discipline are also key,” he adds. An Odebrecht subsidiary, ETH focuses on integrated production, marketing and logistics for ethanol, electric power and sugar. In this interview, José Carlos Grubisich tells Odebrecht Informa about the major transformation that is underway in the sugar/power industry, both in terms of operations – with upgraded and more automated technology – and consolidation, which is giving rise to robust groups that can grow even faster and more competitively.

Odebrecht Informa – Brazil is now the global leader in the sugar/ethanol industry. What stages of development were required to attain that position?
José Carlos Grubisich – First, Brazil has a historical tradition of sugarcane and ethanol and sugar production. We have experienced three major periods. The first was the arrival of sugarcane in this country for the production of sugar and cachaça. It was originally planted in the Northeast and later came to the Central South. There was a second period of major investment and growth associated with the use of ethanol as an alternative fuel through the Proálcool program (launched in 1975 under President Ernesto Geisel), which appeared to give the country a certain energy independence during the oil crisis. The third period began with the creation of the Flex engine, which has completely changed the industry’s dynamics.

OI – Why is the Flex technology having such an impact on the industry?
Grubisich – Flex technology, which was launched on the Brazilian market in 2003, is very creative, allowing the consumer to decide which fuel to use based on price or environmental awareness. The introduction of the Flex engine has radically impacted the growth curve for ethanol production.

OI – How much has ethanol production grown in Brazil?
Grubisich – To give an idea, ethanol consumption in 2006 was around 12 billion liters. By 2009, reported consumption growth was twice that – 24 billion liters. Ethanol has proven to be a clean renewable fuel that is also competitive, as it ends up being cheaper than gasoline in most Brazilian states.

OI – And compared with other fuels?
Grubisich – In recent years, due to the major changes underway in this industry due to investment and modernization, the cost of ethanol production has fallen significantly and its sales price has been very competitive compared to gasoline. In 2009, more ethanol than gasoline was sold on the Brazilian market for liquid fuels.

OI – Is the global market following the same consumption trend?
Grubisich – Increasing consumption of ethanol in the United States, Europe, Japan and China, countries that have researched the matter further, has the advantage of reducing dependence on oil. Oil prices have not risen as much as they would have under normal conditions, and the big advantage, in addition to energy security, is to have a fuel that reduces emissions of carbon dioxide and other greenhouse gases. It offers the hat-trick of energy security, competitiveness and sustainability. Ethanol, which is already a reality in the Brazilian market, has also attracted the attention of major fuel consumers around the world.

OI – Is ETH prepared to meet this demand?
Grubisich – The industry has changed a great deal. Factories are bigger and have added more technology and automation. Farming is entirely mechanized, from planting to harvesting. ETH started out with the aim of achieving complete mechanization in its operations. All our units (nine all told, with production hubs in the states of São Paulo, Mato Grosso, Mato Grosso do Sul and Goiás) have the requisite scale: they each produce 4 million to 6 million metric tons of sugarcane, which is two to three times more than the Brazilian average for this sector. The social and environmental conditions at our company are also considered the most advanced in the industry.

OI – What is the biggest challenge facing ETH today?
Grubisich – It is linked to our ability to carry out the projects that are already underway. Based on a total investment of BRL 7.3 billion, by 2012 we want to become a bioenergy leader, producing 3 billion liters of ethanol and 2,700 GWh per year of electricity from sugarcane. This year, in addition to the expansion of our existing units, two new ones, Morro Vermelho and Alto Taquari, will go into operation.

OI – How are the company’s teams tackling this challenge?
Grubisich – One of the cornerstones of our culture is having confidence in people and grooming them so they can fully take on their responsibilities and entrepreneur the business. The Odebrecht Organization’s culture is revolutionizing the industry.

OI – Now that the industry has been consolidated, professionals’ qualifications must also be brought up to par. Do you agree?
Grubisich – Yes, I do. In the last harvest season alone (2009-2010), ETH invested about BRL 500,000 in educational and training programs. Every month, 22% of ETH’s approximately 8,000 members go through some kind of training, either technical, health and safety, or leadership development. All these programs are aligned with the Odebrecht Entrepreneurial Technology. This makes a very big difference in the way we operate. We want to become the number one company in the bioenergy sector, both in ethanol and power production, using biomass as fuel. The key is always combining sustainability and competitiveness.