Tom Phillips in Palmares Paulista
Friday March 9, 2007

Behind rusty gates, the heart of Brazil's energy revolution can be found in the stale air of a squalid red-brick tenement building. Inside, dozens of road-weary migrant workers are crammed into minuscule cubicles, filled with rickety bunk-beds and unpacked bags, preparing for their first day at work in the sugar plantations of Sao Paulo.

This is Palmares Paulista, a rural town 230 miles from Sao Paulo and the centre of a South American renewable energy boom that is transforming Brazil into a global reference point on how to cut carbon emissions and oil imports at the same time.

Inside the prison-like construction are the cortadores de cana – sugar cane cutters – part of a destitute migrant workforce of about 200,000 men who help prop up Brazil's ethanol industry.

Biofuels are mega-business in Brazil. Such has been the success of the country's ethanol programme – launched during the 1970s military dictatorship – that it is now attracting attention from around the world. Yesterday President George Bush arrived in Sao Paulo to announce an "ethanol alliance" with his Brazilian counterpart, Luiz Inacio "Lula" da Silva. The bilateral agreement has been touted by the Brazilian media as the first step towards the creation of an "ethanol Opec".

Last year sugar and alcohol were Brazil's second biggest agricultural export products, worth an estimated $8bn (£4bn). Producers, meanwhile, expect the country's sugar cane production to jump by 55% in the coming six years, largely because of growing demand from the US and Europe. They hope that closer trade ties with the US in particular will help accelerate the ethanol industry's growth, providing jobs and funding the construction of dozens of new processing plants in the region.

But drive to the outskirts of Palmares Paulista and a much bleaker picture emerges of what President Lula has dubbed Brazil's "energy revolution". On one side, thick green plantations of sugar cane stretch out as far as the eye can see; on the other lopsided red-brick shacks crowd together, home to hundreds of impoverished workers who risk life and limb to provide the local factories with sugar cane.

Economic refugees fleeing the country's arid and impoverished north-east, these men earn as little as 400 reais (£100) a month to provide the raw material that is fuelling this energy revolution.

Palmares Paulista is both a burgeoning agricultural town and a social catastrophe. "They arrive here with nothing," said Valeria Gardiano, who heads the social service department in Palmares, a town of 9,000 whose population swells each year with the influx of between 4,000 and 5,000 migrant workers.

"They have the clothes on their bodies and nothing else. They bring their children with malnutrition, their ill mothers-in-law. We try to reduce the problem. But there is no way we can fix it 100%. It is total exploitation," she said.

Activists go even further. They say the "cortadores" are effectively slaves and complain that Brazil's ethanol industry is, in fact, a shadowy world of middle men and human rights abuses.

"They come here because they are forced from their homes by the lack of work," said Francisco Alves, a professor from nearby Sao Carlos University who has spent more than 20 years studying Sao Paulo's migrant workforce. "They will do anything to get by."

That includes working 12-hour shifts in scorching heat and earning just over 50p per tonne of sugar cane cut, before returning to squalid, overcrowded "guest houses" rented to them at extortionate prices by unscrupulous landlords, often ex-sugar cutters themselves.

Faced with exhausting work in temperatures of over 30C (86F), some will die. According to Sister Ines Facioli, from the Pastoral do Migrante, a Catholic support network based in nearby Guariba, 17 workers died between 2004 and 2006 as a result of overwork or exhaustion.

But the annual exodus from the northeast continues, and as foreign investment in the ethanol industry increases the numbers are expected to grow further.

Among the newest arrivals in Palmares are the Santos family, four brothers aged 19, 22, 24 and 26 who last week stepped off an illegally chartered bus after a 24-hour journey from the arid backlands of Bahia state. "We need the work," said Sidney Alves dos Santos, 24, sitting in the stuffy shack that will be his home until the harvest ends in December. "There's no other way."

In another tatty hovel Pedro Castro, a 26-year-old from Bahia, remembered last year's harvest. "It's like you are inside a bread oven," he said of the thick protective clothes needed in the plantations to protect workers from their sharp machetes. "But there's no work back home. What else are we supposed to do?"

At just after 5pm the square outside Palmares' church fills with the growl of bus engines. A fleet of a dozen battered Mercedes coaches rattle through the town centre, filled with exhausted workers returning from a day in the fields.

"It breaks your heart," said Cristina Vieira, a member of the local Catholic mission that offers support to the workers. "They think it rains money in Sao Paulo but they are chasing an illusion. When you talk to them a lot of them say: 'If I'd have known it would be like this I would never have come.' They have no rights and they can't complain to anyone – in a certain way they don't exist."

In numbers

£4bn
Annual value of Brazil's sugar and alcohol exports

55%
Anticipated increase in sugar cane production over the next six years

£100
Equivalent value of the average sugar cane cutter's monthly wage