Sugar production in Brazil's key Centre South district
slowed for the first time this season as showers slowed the cane harvest, industry
group Unica said, restating a caution of a more serious slowdown ahead.
Mills in the Centre South, responsible for some 90% of
Brazilian sugar output, produced 2.55m tonnes of the sweetener in the first
half of this month, down 30,000 tonnes on output in the last half of June, Unica
The decline, while small, represents the first slowdown in a
2014-15 season which has been marked by a rapid pace of cane harvesting, which
entered July up 11.1% year on year, accelerated by dry weather - which has raised
concerns over yields.
Sugar output has been further supported by an increased diversion
of what cane has been harvested to the sweetener, rather than to ethanol. The
proportion going to sugar so far in 2014-15 is, at 43.6%, up 1.1 points year on
Lower yields, but
Centre South cane crushing volumes, at 41.3m tonnes in the
first half of July, were down 6.4% on those in the second half of June, and
down 3.9% year on year.
The decline was down largely to rains in the south of Sao
Paulo, the top cane growing state, the north of Parana and a "good part" of Mato
Grosso do Sul, Unica said, amid talk that the rains are proving a setback to
coffee growers too, in prompting premature flowering.
Nonetheless, mills, with 244.4m tonnes of cane crushed so
far this season, remain 8.3% ahead of last year on their processing pace –
despite weaker yields of the crop, implying "a considerable advancement in
harvested area", the industry group said.
Cane yields have been hurt by undue dryness for most of 2014,
and while some producers are seeing improved results this year, others "are showing
annual drops of more than 20%", Unica technical director Antonio de Padua
The group restated ideas that cane production will suffer an
unusually early seasonal decline, thanks to the extent of cane already
harvested, and as mills turn to more damaged, or even immature, crops.
"In the Centre South, the expectation is for the reduction
in yield to accentuate in the coming months, due to harvesting of sugar cane
less than 12 months' old, and in areas most affected by the prolonged drought,"
Mr Rodrigues said.
Indeed, fears for a tail-off in output were behind the
elevated diversion of cane to making sugar, rather than ethanol.
"It is natural that companies take advantage of the
current period, when cane quality is at its best, to produce the sugar necessary
to meet future commitments," Mr Rodrigues said.
"Nobody wants to run the risk of not being able to produce
the sugar already contracted to, as there are many doubts about the harvest for
the coming months."