Brazil sugar production to fall 14% due to persistent rains
Sugar production in Brazil’s Center-South is forecast to fall 14.3% year-on-year to 2.7 million tonnes in late September as rainfall disrupts harvesting. Lower sugar recovery and reduced cane allocation weigh on output, while sugar remains more profitable than ethanol amid continued weather risks.
Sugar production in Brazil’s Center-South region could fall by 14.3% year-on-year in the second half of September to 2.7 mln tons. Persistent rainfall restricted machinery access to fields and slowed the sugarcane harvest.
Sugarcane crushing is expected at 38.73 mln tons, down 5.5% year-on-year. Market participants estimate that rainfall halted fieldwork for around 2.5 days in the second half of September, bringing total weather-related disruptions during the month to about 8.5 days.
Crop quality is also expected to deteriorate. Recoverable sugar, or ATR, is forecast at 145.75 kg/t, down from 157.62 kg/t a year earlier. At the same time, mills are expected to reduce the share of cane allocated to sugar production to 50.28% from 51.26% last year.
Despite this, sugar production remains more economically attractive than ethanol. Platts assessed hydrous ethanol at the equivalent of 17.08 cents/lb in raw sugar terms, while NY11 sugar futures stood at 20.25 cents/lb, leaving sugar with a premium of 3.17 cents/lb.
Ethanol production from sugarcane and corn in the second half of September is forecast at 2.17 bln liters, down 2% year-on-year. The market outlook will depend largely on weather conditions, as a strong El Niño could persist through the end of 2026 and continue to disrupt harvesting.
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Source : UkrAgroConsult
