Friday, October 9, 2026.
Brazil
Brazil commands our attention this week as Latin America’s largest economy and one of the region’s most influential political, commercial, and security environments enters a particularly important period.
With the country heading toward a consequential presidential runoff later this month, political uncertainty is intersecting with issues that extend far beyond Brazil’s borders. Foreign investors and international businesses are watching potential changes in taxation, regulation, environmental policy, and economic direction, while expatriates and travelers face a changing landscape involving immigration procedures, personal security, and other practical considerations.
At the same time, recent Brazilian Federal Police operations provide an important reminder that some of the country’s most significant risks are not confined to traditional street crime. Investigations involving organized crime, arms trafficking, money laundering, ransomware, illegal mining, and suspected criminal infiltration of legitimate businesses and institutions demonstrate the increasingly sophisticated nature of the threats confronting companies and individuals operating in Brazil.
For expatriates, international companies, investors, and professionals doing business in the country, understanding Brazil therefore requires looking beyond the headlines. Political developments must be considered alongside corporate risk, cybersecurity, regulatory exposure, personal security, and the integrity of potential business partners and supply chains.
In this week’s BM Investigations newsletter, we take a closer look at Brazil—not simply at what is happening, but at why these developments matter to foreigners living, investing, traveling, or conducting business there. From the upcoming election and organized crime to cyber threats, immigration changes, and practical considerations for expatriates, our objective is to provide the context behind the news and identify the issues worth watching.
Welcome to this week’s focus: Brazil.
Brett Mikkelson
Founder, B.M. Investigations, Inc. – Private Investigations in Panama
Brazilian Elections: Flávio Bolsonaro and Lula da Silva Head to a Runoff, with the President Facing a Difficult Comeback
The projections for this Sunday’s Brazilian elections were confirmed: incumbent President Luiz Inácio Lula da Silva will face right-wing Senator Flávio Bolsonaro in the runoff on October 25.
What was unexpected, however, was Bolsonaro’s clear lead.
With 100% of the votes counted, Bolsonaro finished first with 47.03% of the valid votes — excluding blank and invalid ballots — while Lula received 45.16%, according to data from Brazil’s Superior Electoral Court (TSE).
The difference amounts to approximately 2 million votes.
Since neither candidate surpassed the 50% of valid votes required, the TSE confirmed the runoff.
Although a close second round is expected, “historically, we have never seen a comeback in a second-round election in Brazil,” political analyst Creomar de Souza told BBC News Brasil.
“It is a very, very difficult scenario for Lula,” he explained.
After the voting results were announced, the president said the outcome was “unexpected” and that he had been convinced he would win in the first round.
He stated: “No one but us can offer Brazilian society a future.”
Bolsonaro, for his part, said in his first statement that the numbers showed “the end of the era of the Workers’ Party,” led by the president.
“I am very happy with the result I have just seen: nearly 56 million Brazilians giving me a vote of confidence for change. That is the message from today: Brazil wants change,” he said.
Sunday’s election proceeded normally, according to Kassio Nunes Marques, president of the TSE, during a press conference.
Thirteen candidates were seeking Brazil’s presidency on Sunday, but based on the results, it might have seemed as though there were only two.
The candidate who received the most votes after Bolsonaro and Lula, writer Augusto Cury, failed to reach 3% of the vote.
In addition to choosing the president and vice president for the next four years, Brazilian voters in the country — excluding those living abroad — also voted for members of the Chamber of Deputies, senators, and governors.
When the vote count began, Bolsonaro was receiving more than 50% of the vote, but as counting progressed, the gap between the two candidates narrowed.
This was partly because the southern states, which tend to favor Bolsonaro, are usually among the first to report results, while votes from Lula’s stronghold in the northeast are generally counted later, according to Reuters.
Reactions
Argentine President Javier Milei was among the first international leaders to react, congratulating Bolsonaro after the results were announced.
“Freedom is advancing in Brazil. Congratulations, dear friend Flávio Bolsonaro, on this historic election against Lula the communist,” he wrote on his X account.
Venezuelan opposition leader María Corina Machado praised Brazil’s “exemplary democratic process” and also congratulated Bolsonaro.
“Latin Americans want to live with freedom, democracy, prosperity, and justice, and Brazil has a decisive role in the future of our region. Very soon, Venezuela will also move forward on the path to freedom, and we will leave behind, forever, communism, violence, and crime,” she said.
Meanwhile, Colombian President Abelardo de la Espriella also expressed his support for Bolsonaro during the vote count. “Today my heart is with Brazil. May God have mercy on our brother country as He did with Colombia. Real change means defeating the left,” he wrote on his X account.
From Israel, Prime Minister Benjamin Netanyahu also congratulated Bolsonaro following Sunday’s result. “Congratulations and good luck in the final,” he said, referring to the October 25 runoff.
“I look forward to restoring the extraordinary friendship between Israel and Brazil. My best wishes for your great victory, my friend,” he wrote in a message posted through the official Israeli prime minister’s account.
Two Visions for Brazil
At the end of the month, Lula will seek to become the first person to govern Brazil four times and thereby continue left-wing policies in Latin America’s largest democracy.
If elected, he will also become the oldest president in the country’s history, at age 80.
Flávio Bolsonaro is 45 years old and entered politics in 2002. He is also the son of former President Jair Bolsonaro, who was sentenced to prison for attempting a coup after losing the 2022 election to Lula.
Their visions for the country are markedly different.
Bolsonaro advocates a liberal economic agenda, lower taxes, and tougher measures against crime.
These positions place the senator within the wave of Latin American right-wing leaders aligned with U.S. President Donald Trump.
In fact, following the results, one of the first public congratulations Bolsonaro received came from Colombian President Abelardo de la Espriella, who posted a message on X stating that “real change means defeating the left.”
Lula, meanwhile, built his campaign around proposals such as expanding the role of the state, strengthening social programs, and expanding labor rights.
At the same time, a Lula reelection would likely lead to further tensions between two of the largest economies in the Americas: Brazil and the United States.
According to BBC News Brasil journalist João Fellet, “a central point of divergence between the two candidates concerns the fate of Bolsonaro supporters convicted of attacking democracy following the 2022 elections.”
While Flávio promises to grant amnesty to his father and others convicted in connection with the events four years ago, Lula supports maintaining the penalties imposed on those responsible.
Lula at a Disadvantage
Bolsonaro’s first-round performance, which was better than expected, will give his campaign new momentum, according to analysts.
By contrast, the results revealed signs of declining support for the president.
“Lula’s strategy was designed by looking toward the past, toward his legacy, toward his historical achievements, and toward what, in a way, worked four years ago,” De Souza said.
“Flávio’s campaign, on the other hand, was very effective, particularly during the last seven days, in conveying that, ultimately, this was not about Flávio Bolsonaro, but about removing Lula from power,” he explained.
“This was combined with other strategic elements, such as the emphasis on everyday issues, including the price of meat, rice, and beans,” he continued.
Furthermore, according to the political analyst, there is a clear shift among Brazilian voters toward the right, similar to what is occurring across much of the region.
Andreza Aruska, director of the Brazil Institute at King’s College London, told BBC News Brasil that there is also a factor of “punishing the candidate who is in government.”
“If your life is getting worse, if you compare yourself with your parents when they were your age and you are at a disadvantage, if you cannot fulfill your dreams of owning a home or finding employment, how can you keep those in power in office?” she asked.
According to De Souza, Lula’s challenge in the runoff will be to appeal to undecided voters.
“The protest vote foreshadows what will happen in the second round,” political analyst Rafael Favetti told Reuters.
“While this should benefit Flávio Bolsonaro now, his potential for growth in the second round is reduced precisely because that support has already been concentrated in the first round,” he explained.
Given the historical background and the current regional context, a Lula comeback on October 25 appears unlikely.
Nearly 70 Elected Congress Members in Brazil Are Under Investigation for Corruption and Other Crimes
At least 69 lawmakers elected in Brazil’s elections last Sunday are under investigation for corruption, embezzlement, manipulation of public contracts, environmental offenses, and other alleged misconduct.
According to figures obtained by Brazilian news portal UOL, one in nine members of Congress is currently under investigation. The outlet reported that 33 lawmakers have already been formally charged, while another 36 are the subject of ongoing investigations pending the filing of formal charges.
Most of the cases involve the alleged misuse of public funds, although there are also allegations of domestic violence and racially motivated offenses. Under Brazil’s Constitution, political rights are suspended only in the event of a final criminal conviction, once all avenues of appeal have been exhausted.
Among those under investigation is Liberal Party (PL) lawmaker Mario Frias, whom police are investigating over the alleged misuse of up to 2 million reais (approximately €355,000) in legislative amendments intended to finance the production of Dark House, a biopic about former President Jair Bolsonaro.
According to the report, most of those facing investigations or charges belong to right-wing parties, including Bolsonaro’s Liberal Party and the various political forces that make up the informal parliamentary bloc known as the centrão — the “big center” — which has become essential to governing.
For decades, anyone who has reached the Planalto Palace has had to secure the support of this group, which includes, among others, the Progressives, União Brasil, the Brazilian Democratic Movement (MDB), and the Republicans, all of which are also heavily represented on this list.
On October 4, more than 1,650 positions were contested in elections that determined, in the first round, the new president and vice president, as well as the composition of Congress, the various state legislatures, and state governors. The second round will take place on October 25.
The right secured control of both the Chamber of Deputies and the Senate, as well as key positions such as the governorship of São Paulo. Most notably, ultraconservative candidate Flávio Bolsonaro won the presidential vote with 47%, two percentage points ahead of President Luiz Inácio Lula da Silva.
Brazil’s Sugarcane Harvest Faces Challenges, Raising Concerns About Future Production
Persistent rainfall in central-southern Brazil threatens to alter the conclusion of the 2026/27 sugarcane season and shift a significant portion of production into the next agricultural cycle. Industry estimates indicate that approximately 32 million metric tons of sugarcane could remain unprocessed until the 2027/28 harvest due to difficulties in advancing harvesting and milling operations. The situation is raising concerns in one of the world’s leading sugarcane-producing regions, where excessive moisture is reducing the number of days available for fieldwork and disrupting industrial planning.
The greatest risks are concentrated in Paraná, southern Mato Grosso do Sul, and various areas of São Paulo, states that have recorded significant rainfall accumulations in recent weeks. Weather conditions are making it difficult for machinery to access fields, affecting harvesting operations and complicating the transportation of raw material to processing plants. The possibility of carrying millions of tons over into the next season is already being incorporated into the projections used by the industry to plan the conclusion of the current production cycle.
According to estimates from specialized consultancy StoneX, approximately 10 million metric tons of the pending volume could be processed during March 2027, while the remaining 22 million tons would be distributed across the first half of the 2027/28 season. This forecast means that some of the sugarcane currently available could remain in the fields for longer, with implications for harvesting operations, plant performance, and the industrial characteristics of the raw material.
Milling Falls 34.2% as Rainfall Affects Sugarcane Quality
The effects of the rainfall began to be strongly reflected in September’s indicators. During the first half of the month, sugarcane milling in central-southern Brazil fell 34.2% compared with the same period in 2025, as a result of disruptions to agricultural and industrial activities. In cumulative terms through September 15, processed volumes recorded a year-on-year decline of 1.5%, marking the first cumulative decrease of the current season compared with the previous one.
The reduction in processing is not the only challenge facing the industry. Delayed harvesting is also changing the conditions under which sugarcane reaches processing plants, particularly in terms of recoverable sugar content. Projections indicate that ATR, an indicator measuring the amount of total recoverable sugar in the raw material, could remain below average during 2026. This factor is critical for industrial production, as it affects the utilization of sugarcane destined for sugar and ethanol production.
However, greater water availability can also support vegetative crop development. Abundant rainfall contributes to higher agricultural yields measured in tons of sugarcane per hectare (TCH), which could partially offset the lower sugar concentration. As a result, processing plants are facing a combination of greater biomass potential and lower industrial quality, two variables that will need to be considered when evaluating the actual performance of the season.
The situation could also affect sugarcane that remains unharvested until next year. Estimates indicate that this cane could maintain favorable yield potential per hectare, although it would remain exposed to lower recoverable sugar concentrations when it reaches processing plants in 2027. For the industry, this means adjusting milling schedules and assessing how to allocate operational capacity between the end of the current season and the beginning of the next.
El Niño and an Early Harvest Shape the Outlook for 2027
Faced with the possibility of carrying over a considerable volume of raw material, industries in central-southern Brazil are beginning to assess changes to their operating schedules. One option would be to extend milling for the 2026/27 season through December and bring forward the start of the following season to March 2027. This strategy would allow some of the pending sugarcane to be processed before the usual start of operations, although implementation will depend on weather conditions.
The main question is whether rainfall will allow agricultural activities to resume in March. If precipitation once again exceeds normal levels, access difficulties in the fields could recur and further delay harvesting. The availability of machinery, rural road conditions, and transportation capacity will be important factors in determining how much volume can actually reach processing plants during the first weeks of the new season.
The climate outlook also takes into account the potential development of the El Niño phenomenon, which is expected to peak during the final quarter of 2026, according to projections cited by industry analysts. Although it is not yet possible to determine precisely how rainfall will behave during the first months of 2027, there are concerns that high-moisture conditions could persist in the main sugarcane-producing regions.
Climate uncertainty is particularly important because Brazil needs to coordinate the processing of large volumes of raw material within limited operating periods. When rainfall reduces the number of days available for harvesting, processing plants must reorganize shifts, logistics, and milling capacity. In addition, prolonged exposure of sugarcane in the fields can alter its productive characteristics and affect supply forecasts for sugar and ethanol processing facilities.
For now, industry estimates continue to point to an early start of the 2027/28 harvest in March as the most likely scenario, with approximately 10 million metric tons of sugarcane available to begin processing. However, the feasibility of this schedule will depend on rainfall patterns during the Brazilian summer and field-access conditions. The outcome will be particularly important for the regions of Paraná, Mato Grosso do Sul, and São Paulo, where a significant portion of the volume potentially remaining from the current season is concentrated.
Brazil Awards 56 Offshore Blocks to Petrobras and Equinor
Brazil awarded 56 oil and gas exploration blocks in two rounds held on October 7, 2026. Companies winning offshore blocks included Petrobras, Equinor, QatarEnergy, Galp, and several Chinese companies, according to results published by the National Agency of Petroleum, Natural Gas and Biofuels (ANP).
Of the total, 49 blocks were awarded through the sixth Permanent Concession Offer, while the remaining seven were awarded through the fourth Permanent Offer for Production Sharing. The awarded areas include offshore acreage in the Campos, Santos, and Ceará basins, as well as exploration areas in various regions of Brazil.
Brazil Awards New Blocks to Petrobras and QatarEnergy in Ceará
In the concession round, Petrobras secured 12 offshore blocks in the Campos Basin and another seven in partnership with QatarEnergy, this time in the Ceará Basin, off Brazil’s northeastern coast. The Brazilian state-owned oil company will operate the seven Ceará blocks, holding a 70% stake, while QatarEnergy will hold the remaining 30%.
The areas awarded to the two companies correspond to blocks CE-M-471, CE-M-473, CE-M-475, CE-M-477, CE-M-537, CE-M-539, and CE-M-665. These concessions are located along Brazil’s Equatorial Margin, a region that has attracted interest due to its potential for the exploration of new hydrocarbon resources. However, the awards do not mean that operations will begin immediately, as the companies must comply with the applicable contractual and regulatory requirements.
The round also included onshore blocks in the Potiguar, Tacutu, Recôncavo, Parnaíba, and Tucano Sul basins. Selected companies included Eneva, PetroRecôncavo, Aguila, Alvopetro, Origem, Petrom, and Tucano Serviços.
Equinor, Galp, and Chinese Companies Secure Pre-Salt Blocks
The production-sharing round awarded seven pre-salt exploration blocks across the Santos and Campos basins. Equinor and Galp secured the Rodocrosita block, located in the Santos Basin. The Norwegian company will serve as operator, holding a 70% stake, while the Portuguese oil company will hold the remaining 30%.
Equinor also secured the Rubi block, while Chinese companies CNOOC Petroleum and Sinopec were awarded the Jade block. CNOOC will operate the block with a 70% stake, while Sinopec will retain the remaining 30%.
Petrobras also expanded its exploration portfolio with the award of the Azurita block in the Campos Basin and Cruzeiro do Sul in the Santos Basin. The Brazilian company will hold a 100% stake in both blocks.
Meanwhile, Prio Forte secured the Magnetita and Hematita blocks, both located in the Campos Basin, and will hold 100% of the interest in each area.
Production-Sharing Auction Surpasses 2025 Results
The ANP reported that the seven blocks awarded under the production-sharing regime represent the largest number awarded in a single cycle since the permanent-offer system began being used. The result surpasses the five blocks awarded in 2025 and highlights operators’ interest in adding new exploration opportunities in Brazil’s pre-salt region.
Although both mechanisms allow companies to conduct hydrocarbon exploration and production activities, their contractual terms differ. Under the production-sharing regime, companies conduct petroleum activities through contracts that provide for the state to receive a share of the production obtained. Under traditional concession agreements, companies may explore and produce hydrocarbons in accordance with the technical, economic, and regulatory obligations established for the awarded areas.
When Will the Contracts for the Awarded Blocks Be Signed?
Following the conclusion of the award rounds, the winning companies must submit the required documentation and complete the administrative procedures established by the ANP. The contracts are scheduled to be signed on February 26, 2027, once the companies have fulfilled the requirements imposed by the regulatory authority.
Until then, the auction results represent the allocation of rights over the areas offered but do not, by themselves, authorize the immediate commencement of exploration activities. The development of the new projects will depend on the formalization of the contracts, the acquisition of the necessary authorizations, and compliance with the applicable work programs.
With these awards, Brazil is expanding exploration opportunities for both domestic and international companies, covering pre-salt areas in the Santos and Campos basins, as well as the Equatorial Margin and the country’s onshore basins.
Regenerative Tourism to Fund Coral Reef Restoration in Brazil
Bio Fábrica de Corais is promoting regenerative tourism along Brazil’s coast to finance the restoration of its coral reefs. The initiative involves cultivating coral colonies in marine nurseries and subsequently transplanting them into degraded ecosystems.
“Brazil is home to the only reef barrier in the South Atlantic and lacked the infrastructure needed to carry out restoration on a large scale. That is why we were created,” says Rudã Fernandes, CEO of this deep-tech company.
“There was science, there was diagnosis, but there was no one producing coral,” he says, while warning of the “collapse” of these ecosystems, which “are home to more than 25% of marine biodiversity” and experienced “the fourth wave of mass bleaching” between 2023 and 2024.
Through Bio Fábrica de Corais, the entrepreneur and PhD in Biological Sciences from the Federal University of Pernambuco in Brazil cultivates “around 12,000 corals from seven species” in marine nurseries, which are later transplanted to degraded reefs, he explained in an interview with EFE.
Coral Transplantation
The process involves collecting “fragments of fallen colonies damaged” by vessel groundings, anchor impacts, or bleaching events and recovering them so that “they can return to their habitat.”
To achieve this, the corals are attached to a support structure manufactured with a 3D printer and “shaped according to the morphology of the species,” Fernandes explains.
The objective is for the colony to reach “sufficient size and skeletal structure to colonize the nursery structure (grow over it) and withstand the hydrodynamic conditions of its destination.”
The nurseries are located directly in the sea, installed on reefs in Porto de Galinhas and Tamandaré, in Pernambuco, and Maragogi, in Alagoas. Bio Fábrica de Corais also operates laboratory facilities for “the more delicate stages and research.”
The decision to return a colony to the ocean, he says, “is not based on the amount of time that has passed, but on its biological condition”: intact tissue, no signs of bleaching or disease, and “consistent growth” based on its biometric measurement history.
Funded by Tourism
In addition to coral restoration, another defining feature of Bio Fábrica de Corais is its funding model: regenerative tourism.
“The visitor gets into the water with our technical team, learns how to handle the coral, and personally plants a fragment in the nursery. Afterwards, they receive information about the growth of that colony,” Fernandes explains.
He adds that, “since 2023, more than 650 people have experienced this activity,” with “approximately one in every five biotourists at the facility being a foreign visitor.”
So far, visitors have come from 18 different countries, with Spain ranking “among the top five markets,” he notes.
Although the company receives public funding and grants “for research and development,” it seeks to create economic mechanisms that will allow the initiative to become self-sustaining, “because conservation that depends exclusively on donations is neither scalable nor sustainable.”
Three Reasons to Restore
Fernandes argues that coral colony restoration is essential at a time when “the world is experiencing the largest coral bleaching event ever recorded.”
He warns: “Brazilian reefs are home to endemic species that, if they disappear from here, will disappear from the planet.”
From an economic perspective, these ecosystems are critical to tourism because “without living corals, there are no natural pools, no fish, and no visitors. Conservation does not compete with the local economy; it is a prerequisite for it.”
Finally, the entrepreneur and PhD in Biological Sciences adds that Bio Fábrica de Corais is seeking to demonstrate that reef restoration “can be a business, with proprietary technology, its own revenue streams, and auditable indicators.”
If successful, he believes the initiative can bring conservation closer to local economic agendas, concluding: “We need to create the conditions that enable people to take action against climate change.”
