Brazilian sugar exports to hit seven-year low
US officials ditched ideas of a rise in Brazilian sugar output, and cut export forecasts to a seven-year low, despite boosting expectations for the cane harvest, thanks to yield-boosting rains.
The US Department of Agriculture’s Sao Paulo bureau lowered by 1.0m tonnes, to 35.0m tonnes, its forecast for overall sugar output in the top producing country in 2015-16, which started in April.
The downgrade – which took the figure below the 35.95m tonnes the bureau estimated for output last season – put production on course for a third successive season of decline from the record 38.6m tonnes achieved in 2012-13.
And the revision came despite an improved forecast for the country’s cane crop, lifted by 6% to 684m tonnes, reflecting a recovery in yields in the key Centre South region from last year’s drought-affected levels.
However, some 25m tonnes of cane are likely to go unharvested, given a pace so far only in line with last year’s.
“The beginning of the rainy season in November-December 2015 will likely bring logistical obstacles for harvesting, thus limiting the crushing of the total estimated production volume,” the bureau said.
The comments echo those earlier in the week from analysis group Green Pool that in the Centre South, which is responsible for some 90% of Brazilian sugar output, about 595m tonnes of cane would be crushed out of “more than 620m tonnes available” for harvesting.
The so-called carryover, or bisada, cane left unharvested is typically processed early in the following season.
And of what is harvested, sugar levels are proving lower than initially expected, thanks in part to the downside of the rains which boosted agricultural yields, encouraging plants to dig into energy stores to fuel growth.
The bureau flagged “above-average rainfall during harvest, excessive blossoming spread out through the Centre South, and high impurity content in the cane delivered for crushing, which negatively impacts the quality of the sugarcane stocks”.
Furthermore, mills are seen diverting more cane, 59.4%, to making ethanol rather than sugar, further depressing levels of sweetener produced.
The lower production will feed through into a, small, drop in shipments year on year to 23.75m tonnes, against a third successive season of decline – and a seven-year low.
The bureau flagged “expected lower sugar availability and depressed sugar prices in the world market due to high world stocks”.
Raw sugar was seen accounting for 18.95m tonnes of the exports, with the balance of 4.8m tonnes comprising refined sweetener.
(Source – http://www.agrimoney.com/news/brazilian-sugar-exports-to-hit-seven-year-low–8868.html)