Brazil’s sugar production projected to surge, S&P Global reports
Brazil’s Central-South region is expected to produce around 3.54 million tons of sugar in the first half of August, marking a notable increase of 34.4% compared to 2022, per S&P Global Commodity Insights’ recent findings.
Brazil leads the world in sugar production, contributing 22% of global supply
Beneficial weather conditions during this period are predicted to support one of the highest bi-weekly sugarcane crushings.
S&P Global’s survey anticipates a crushing total of 49.6 million tons, up 27.9% from the previous year.
The decision to process the sugarcane for ethanol or sugar production primarily depends on prevailing market prices.
Market players are keenly observing the ATR (total recoverable sugar) figures and ethanol production results from early August, explains a São Paulo-based analyst.
If ethanol prices are not profitable, sugar availability may increase in the market.
According to hEDGEpoint Global Markets, sugar prices experienced some fluctuations over the past week but without significant changes.
They noted that as long as Central-South’s crushing remains favorable, a strong bullish trend in the short term is unlikely.
External factors, such as increased rainfall in the Central-South region over the forthcoming two weeks, may affect the harvesting pace, as indicated by hEDGEpoint.
Lívea Coda, a sugar and ethanol analyst, mentions potential market volatility depending on future weather predictions.
Additionally, the Indian Meteorological Department confirmed the driest August in over a century, impacting sugar production and its availability for global markets.
Regarding ethanol production, S&P Global estimates a production of 1.397 billion liters of hydrated ethanol from sugarcane and corn, up 20.13% year-on-year.
Meanwhile, anhydrous ethanol production is projected to reach 984.7 million liters in the early half of August, a 15.61% increase from the prior year.
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