PRINTABLE VERSION   EMAIL TO A FRIEND   RSS FEEDS 18:23 UK, 20th Apr 2014, by Agrimoney.com
US officials cautious over Brazil's cane harvest

US farm officials sided with commentators more downbeat on Brazilian cane production prospects, cautioning over low levels of replanting besides damage from the drought which has revived prices.

The US Department of Agriculture bureau in Brasilia pegged the cane harvest in 2014-15 the Centre South, responsible for some 90% of Brazilian production, at 575m tonnes.

That represents a decline of 21m tonnes on last season, and is among the more pessimistic views for the region, in line with those from the likes of Louis Dreyfus and Rabobank.

Broker Sucden Financial is a little more optimistic, pegging the Centre South cane harvest at 586m tonnes, while the official Conab crop bureau sees the crush in the newly-started season at 612.9m tonnes.

'Drought in several growing areas'

The USDA bureau cited "drought in several growing areas in the Centre South, which has delayed the maturity of the sugarcane", and reduced yield prospects.

According to the International Sugar Organization, the region received 340mm of rain in the December-to-February period, "only half the normal levels of over 620mm".

However, the USDA staff also flagged "below average replanting of sugar cane", with area seen rising only 100,000 hectares year on year.

A wet weather spell last year represented a setback, in offering "problems during the herbicide spray period", while the further spread of mechanised harvesting would further depress yields.

Mechanised harvesting, while encouraged by Brazilian labour laws, is less efficient that manual cropping.

National prospects

Sugar output from the Centre South should fall by some 1m tonnes to 33.55m tonnes, with the decline limited by some switch by mills towards making sweetener rather than ethanol from cane.

The proportion of cane allocated to producing sugar is expected to rise to 46.5%, up 1 point from last season, encouraged by a revival in prices, with the balance used for ethanol.

Overall Brazilian cane production will reach 629,000 tonnes, down 21,000 tonnes year on year, and sugar output hit 36.8m tonnes, down 1m tonnes, with the performance in the North East expected roughly the same as last season.

Sugar exports will fall in line, by 950,000 tonnes to 25.25m tonnes, "due to lower expected sugar production, therefore lower expected exportable supply".

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