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Brazil sugar output soars - thanks to cane quality, as well as mill switch

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Unica flagged the boost to Brazil’s sugar output this season from cane quality, as well as reduced competition from ethanol in mills’ crushing regimes, even as it revealed a further gain in a key crop specification.

 

The industry group - reporting a surge of 7.88m tonnes to 25.90m tonnes in sugar output in Brazil’s key Centre South region in the first five months of the 2020-21 crushing season – said that a little over three-quarters of the increase was indeed down to a switch by mills to making more sweetener.

 

Centre South crushers have turned 47.0% of their cane into sugar in the April-to-August period, up from 35.5% at the same point of 2019-20 – if below the high of 48.7% recorded for 2017-18, Unica said.

 

However, “the other 1.84m tonnes” in extra sugar output this season “is the result of improving in crushing operations, and of better quality of the raw material harvested”.

 

Sweetness levels

In the April-to-August period, the so-called ATR – the level of sugars extracted by mills from cane – reached 139.3 kilogrammes per tonne of crop, up 6.0 kilogrammes year on year.

 

That improvement factored in a figure of 156.1 kilogrammes per tonne of cane for the second half of August, a historically high result for the time of year.

 

Indeed, it represented an increase from 152.6 kilogrammes in the first half of last month, and from 151.0 kilogrammes in the first half of August last year.

 

The figure was also above the 154.6 kilogrammes-per-tonne-of-cane figure that investors had expected, according to a poll by S&P Global Platts.

 

‘Record season’

The elevated level of sugar levels in cane has been attributed to benign conditions, with rains over the summer encouraging cane development, while dryness since has concentrated sucrose at high levels.

 

Indeed, Thursday’s figure kept the 2020-21 crop on track for what S&P Global Platts believe will be a record season for ATR, “higher than 141 kilogrammes per tonne of cane, reaching a peak of about 157 kilogrammes per tonne during the second half of September before declining through the end of the harvest”.

 

In the second half of last month, the elevated ATR helped Centre South sugar output rise by 16.3% year on year to 2.93m tonnes, matching investor expectations - despite a small shortfall in the cane crush, and a smaller allocation of crop to sugar than the market had forecast.

 

Strong exports

Unica also flagged that official data showed sugar exports for August as a whole more than doubled to a record for the month of 3.47m tonnes.

 

By destination, China has proved a particularly strong buyer, with its shipments of raw sugar from the Centre South topping 1.5m tonnes over July and August.

 

India was the second-ranked destination, at 710,000 tonnes, ahead of Algeria on 655,000 tonnes and Iraq on 524,000 tonnes, Czarnikow data show.

 

The commodities house reports 2.4m tonnes of raw sugar nominated so far for export this month.

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