Sugar production in the center-south of Brazil would total between 36 and 38.5 million tons in the 2023/24 harvest, which starts in April, depending on the behavior of oil and gasoline prices, in addition to the economic scenario, estimated on Tuesday, October 25, the consulting firm Datagro.
In his first projection for the new season, the consultant’s president, Plinio Nastari, said it is too early to mark a definite position.
Still, it is estimated that the sugarcane crushing will increase to 575 million and 590 million tons, with better weather conditions and investments in sugarcane fields.
The estimated crush for the current crop is 542 million tons, in a crop recovering from very poor yields due to drought and frost in the last cycle, while sugar production is expected to stand at 33.25 million tons in the region in 2022/23.
Nastari noted that the sugarcane fields in the country’s largest producing pole are developing well for the new harvest in response to more favorable weather conditions, but with the expectation of a reduction in the area dedicated to the crop.
“We foresee for 2023/24 an additional reduction of 1.8% of the area, which we take into account in our estimates,” he said, without detailing the estimated area for the next cycle.
The reduction is due to the profit margins of grains, which exceed sugarcane results and have led producers to plant soybeans, for example, to the detriment of sugarcane plantations.
The Datagro president said that a delay in the Indian harvest and a modest recovery in Thailand’s production should keep the international market hot and demand for the Brazilian sweetener.
As for ethanol, he noted that the energy crisis in Europe, driven by the Russia-Ukraine war, indicates an increase in biofuel exports.
On the other hand, the continued expansion of ethanol production from corn tends to increase the biofuel supply in Brazil, which may lead mills to opt for a production mix with more sugar in 2023/24. Datagro did not disclose ethanol production projections for the new harvest.
For the current cycle, total ethanol production was estimated at 29.27 billion liters, of which 24.67 billion from sugarcane and 4.6 billion from corn biofuel.
With information from Reuters