The advance of the 2026/27 sugarcane harvest in the Center-South of Brazil increased the supply of ethanol on the market and caused a significant drop in biofuel prices at the pumps in May. According to a survey by Veloe’s Fuel Price Monitor, prepared with technical support from the Economic Research Institute Foundation (Fipe), hydrated ethanol registered a decline of 5.6% in the month, the biggest drop among all monitored fuels.
As a result, the national average price of ethanol fell to R$4.488 per liter, in an accommodation movement after those observed in March and April.
Mainly due to the increase in sugarcane crushing in the Center-South, the main producing region in the country, which increased the availability of fuel in the domestic market.
“The advance of the harvest increased the supply of ethanol and favored the reduction of prices at the pump, increasing the price compared to gasoline in several regional markets”, points out the survey.
Among the states, the Federal District recorded the biggest drop in the country, with a drop of 10% and an average price of R$4.528 per liter. Next come São Paulo (-7.2%), Minas Gerais (-6%), Paraná (-5.1%) and Mato Grosso (-4.9%).
In São Paulo, Brazil’s main ethanol consumer and producer market, the fuel ended May with an average of R$4.20 per liter.
In addition to ethanol, the prices of regular diesel and S-10 diesel also fell 3.3% compared to April. Regular and added gasoline fell by 1%, while natural gas for vehicles (CNG) was the only fuel to record an increase in the period, by 0.3%.
Despite the relief at the pumps in May, fossil fuels will still accumulate significant increases in 2026. S-10 diesel leads the increase in the year, with an increase of 16.8%, followed by regular diesel (+16.6%). Regular gasoline accumulates an increase of 7.5%, while ethanol registers a slight increase of 0.3% in the first five months of the year.
According to André Turquetto, CEO of Veloe, the international scenario continues to put pressure on fossil fuels in Brazil.
“May brought an important price accommodation movement, especially in ethanol, driven by the advance of the harvest and the expansion of supply. Even so, diesel and gasoline remain at high levels in the year to date, showing that the effects of international pressure on energy continue to be present in the Brazilian market”, he stated.
In the weekly comparison, the data show that ethanol renewed its low of the year in the week of May 23, reaching an average of R$4.40 per liter, after a sequence of drops that began in the second half of April.
The survey also points to an improvement in the purchasing power of the Brazilian consumer. In the first quarter of 2026, filling a 55-liter tank with regular gasoline compromised, on average, 5.5% of the household income of Brazilian families and 3.7% on average in the capitals — the lowest percentages for the period since the beginning of the historical series, in 2017.
Even so, relevant regional differences remain, mainly in the North and Northeast regions, where the burden of supply on family budgets remains higher.
