São Paulo – The Brazilian Mid-South is expected to produce 508 million tonnes of cane in the 2012-2013 crop, generating 32.51 million tonnes of sugar and 21.2 billion litres of ethanol. The figures were culled from a survey by Archer Consulting, a firm that specializes in agricultural commodity risk management. The last crop amounted to 496 million tonnes.
According to Archer, specialists claim that in spite of a low crop, ethanol production will suffice to meet consumer demand and sugar production will grow. The sugar market closed on a bearish note in New York last week. Thailand, a major producer, had a historical crop and India, another leading player, authorized higher export volumes.
“Despite the stronger dollar in relation to the [Brazilian] real, the profitability of sugar is decreasing,” says Arnaldo Correa, risk management and director of Archer Consulting. The trend can cause sugar and ethanol plants to reassess their sugar-to-ethanol production ratio.
*Translated by Gabriel Pomerancblum
