Potential profitability of alcohol microdistilleries from sugarcane: a preliminary study

Abstract

The potential profitability of alcohol microdistilleries from sugarcane is analysed. Their unit costs are competitive with those obtained from large distilleries. The farmer or cooperative with a diversified area of arable crops above 800 ha, has the comparative advantage for the production of sugarcane. For this kind of producer the installation of a microdistillery will be profitable, even under conditions of overestimated production costs. From a social point-of-view the installation of microdistilleries is also attractive. When compared with the installation of large distilleries in order to meet the government goal of additional 4,5 billion litres of alcohol by 1985 the microdistilleries offer the advantage of generating more jobs with less total capital investment and with smaller transportation costs of raw material.