The biodiesel market concentration in Brazil

Abstract

Brazil, despite having several potential sources for biodiesel production, has prioritized the use of oleaginous that can generate more workforce jobs including regions that are outside of the economic development process. With this focus and to regulate the market, the National Petrol Agency, since 2005, stipulated that the sale of this product would be happen only through auctions. This article aims to analyze and discuss this concentration of companies that participated of the sixteen auctions already realized. For that, it was used the concentration indicators like Gini’s and Theil’s indexes, and the Partial Concentration index (PC). It was observed that the biodiesel market in Brazil seems to be more concentrated because of its least quantity of qualified companies and for their capacities of competing in an initial period of production. However, from the 4th auction the quantity of participant companies able to produce and participate of the auctions increase and, consequently the concentration level decrease, by the CR4 index. However, Gini’s and Theil‘s indexes, that also consider the sold volumes, demonstrate a concentration increase still in a moderate level.
Key words: auctions, familiar agriculture, index of Gini, index of Theil.