Adecoagro agrees to buy Brazil’s Caarapó sugar and ethanol mill for $148 million
Argentina-based Adecoagro agreed to acquire Raízen’s Caarapó sugar, ethanol and renewable energy plant in Brazil for $148 million. The deal expands Adecoagro’s cluster in Mato Grosso do Sul as Brazil raises the mandatory ethanol blend in gasoline to 32%.
Adecoagro adds a third mill in Mato Grosso do Sul
Argentine agribusiness company Adecoagro has agreed to pay $148 million for a sugar, ethanol and renewable energy plant in the Brazilian state of Mato Grosso do Sul, Infobae reported. The Caarapó mill is being acquired from Grupo Raízen, the Brazilian energy company associated with Shell. The transaction includes company-owned sugar cane and supply contracts with third-party growers.
Caarapó is located about 100 kilometers from Adecoagro’s Angélica and Ivinhema mills. Renato Junqueira Pereira, vice president of Adecoagro’s Sugar, Ethanol and Energy business, described the acquisition as a natural extension of the company’s industrial platform in the state. He said the geographic proximity would allow Adecoagro to increase Caarapó’s crushing volume through marginal investments. Co-founder and CEO Mariano Bosch said the purchase strengthens the company’s position among the industry’s most efficient producers.
Brazil increases ethanol demand through higher blend
The acquisition comes as Brazil gives ethanol a larger role in its fuel market. On July 14, the country raised the mandatory ethanol content in gasoline to 32%, from the 30% level introduced in August 2025. Infobae linked the latest increase partly to higher oil costs arising from the conflict between Iran and the United States. Brazil’s Future Fuel Law, approved in 2024, allows the mandate to rise as high as 35%.
Argentina’s compulsory ethanol blend remains at 12%, while a voluntary ceiling of 15% was authorized in March. In June, the Senate began considering a biofuels bill promoted by Patricia Bullrich that would raise the gasoline ethanol requirement from 12% to 15%, increase the biodiesel blend in diesel from 7.5% to 10%, and permit Flex Fuel engines. The proposal has divided the industry: large agricultural exporters see an opportunity to direct installed capacity toward the domestic market, while regional small and medium-sized producers fear losing ground in a business they have supported for almost two decades.
Transaction reflects expansion at Adecoagro and disposals at Raízen
The Caarapó purchase remains subject to approval by Brazil’s Administrative Council for Economic Defense, known as CADE, and to the other conditions in the agreement. It follows a series of changes at Adecoagro. In April 2025, stablecoin issuer Tether confirmed the acquisition of 70% of the company after adding 49,596,510 ordinary shares at $12.41 each in a transaction worth more than $615 million. Tether had already held 19%.
Adecoagro and Asociación de Cooperativas Argentinas also took full control of fertilizer producer Profertil after acquiring Nutrien’s 50% stake and exercising an option over the remaining 50% held by YPF. Profertil produces about 1.3 million tonnes of urea annually and supplies approximately 60% of Argentina’s domestic demand. For Raízen, the Caarapó agreement is another disposal: in June it agreed to sell its Argentine assets to Mercuria Energy for $1.42 billion. That package includes the Dock Sud refinery, 894 Shell-branded service stations, a lubricant plant and fuel terminals. Raízen said the proceeds would support management of the group’s capital structure.
