Does the VHP Sugar Price Influence in the Ethanol Volume Production?

Brazil has become one of the major producers of sugar and ethanol. However, as both products share the same production process, the volume of production of sugar or ethanol is influenced by government policies and marketing prices. The purpose of this research is to analyze the influence of the international prices of VHP sugar in the mix of production of hydrous ethanol and sugar. A multiple linear regression studies with statistical software R was conducted using as reference data of Mato Grosso do Sul state, Brazil between 2002/03 and 2014/15. The results indicated that the sugar and ethanol production in this state was bonded to the prices variance of VHP sugar on the international market.

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