Brazilian ethanol producer Guarani has forecast an 8% increase in sugarcane crushing to 17.5Mt in the 2012-13 fiscal year.
In an investor report, Guarani's parent company Tereos Internacional said it had already spent 270mn reais (US$131mn) of its 787mn-real 2012-13 capital expenditure plan on new projects.
"We are progressing on our investment plan to expand cogeneration potential while increasing crushing capacity," the report said.
"We are putting a strong effort into renewing and expanding our sugarcane fields while maintaining our light-asset business model."
Biofuel production will comprise 51.3% of the company's ethanol-sugar mix in the current harvest, down from 51.6% in 2011-12.
Guarani identified difficult climatic conditions and a volatile exchange rate as the major challenges facing Brazil's ethanol producers.
Predictions by sugarcane industry association Unica of a 4.6% increase in ethanol production to 21.5Bl this harvest have buoyed the industry, according to the report.
But Guarani says suppliers need greater assistance to remain competitive.
"The sector is awaiting measures to support growth from the government, such as equalization of tax rates among states or any upward adjustment by the government in the blending of the gasoline from the current 20% to 25%," the company said.
Tereos Internacional reported a net profit after taxes of 157mn reais for the fiscal year ending March 31, up 24.8% on the previous year.
Total revenues rose 18.8% to 6.9bn reais while Ebitda reached 959mn reais, an 11.6% increase year-on-year.