Brazil, the world's largest sugar producer, fulfils 16 per cent of its energy consumption and approximately three quarters of its transport fuels with sugarcane-based ethanol. During Brazil's internationalisation under President Lula da Silva, and to a lesser extent in President Rousseff's first term, the country aimed at creating a global market for ethanol. The time seemed right to steer foreign policy towards this goal due to a benevolent structural environment with global discussions about energy security, climate change and South–South cooperation.

Within a Neoclassical Realist framework, I show how Brazil failed to bring its ethanol diplomacy to success and to create a global market for ethanol. Neoclassical Realism sheds light on the area of energy security. This is an approach that so far has mainly been applied to hard security questions.

The analysis covers three analytical levels: the bilateral with Brazil in power deficit, the bilateral with Brazil in power surplus and the multilateral, represented in three empirical chapters: Brazil–US, Brazil–Mozambique and Brazil's multilateral ethanol diplomacy.

Process tracing based on primary-source research and expert interviews leads to the conclusion that the Brazilian foreign policy complex (FPC) failed to formulate and implement a coherent ethanol strategy. Ethanol diplomacy was never a top priority for Brazil's Ministry of Foreign Affairs, representing a lack of cohesion in the FPC. In international negotiations, Brazil has deficits in predicting its negotiating partners’ preferences and therefore lacks the ability to form long-term alliances with converging interests, rather than merely convening disruptive ad hoc coalitions.

This study shows that Neoclassical Realism can combine foreign policy output with international politics outcome research and is useful to analyse policy outside the hard security realm. It offers a basis for further research towards an understanding of Brazil's overall foreign policy and the foreign policies of other emerging powers.