Brazil’s sugar production will stage some recovery in 2022-23, lifting exports too, despite a slow start to the cane crushing season in the key Centre South region, US officials said in their first forecasts for the new season.
The world’s top sugar producer will in 2022-23, as started this month in Brazil, manufacture 36.61m tonnes of the sweetener, the US Department of Agriculture’s Brasilia bureau said.
That would represent an increase of nearly 1.0m tonnes from last season, when volumes were depressed by damage to Centre South cane crops from prolonged dryness and from frosts in June and July last year.
“The good rainfall volume that has prevailed since October 2021, although irregularly distributed in the different production regions,” should help a cane revival from preceding drought and frost setbacks, the bureau said.
Nonetheless, the bureau stressed that the revival in cane production in the Centre South, which grows more than 90% of Brazil’s crop, will by only “partial”.
Although this season’s Centre South cane crush will, at 560m tonnes, expand by 37m tonnes year on year, it will remain well below historic highs.
The region in 2020-21 processed 605.5m tonnes of cane, with the record of 617.7m tonnes set in 2016-17, according to data from industry group Unica.
Indeed, even with the prospect of an enhanced cane crush, mills are delaying the start of operations to allow crops extra time to recover and, it is hoped, exploit higher yields.
“The late development of the sugarcane fields to be harvested in the first third of the crushing season has led sugar/ethanol plants to postpone the beginning of the 2022-23 crushing season to late April and May.”
Unica has reported that as of late March, the number of Centre South cane mills in operation was, at 16, less than half the 37 running a year before.
Centre South sugar output will expand by 1.0m tonnes to 33.3m tonnes, raw value, in 2022-23, the USDA bureau said. The regional record, of 36.1m tonnes, was set five years ago.
The forecast national output of 36.61m tonnes would also remain well shy of the high of 42.05m tonnes set two years ago, and would in fact rank only eighth among Brazil’s biggest sugar producing seasons.
National sugar exports in 2022-23 will, “due to the likely higher sugar exportable surplus compared to the previous year”, reach 26.62m tonnes.
That would represent expansion of nearly 1.0m tonnes year on year, but leave volumes still well behind the record of 32.15m tonnes set in 2020-21.
Expanding world surplus?
Prospects for Brazil’s sugar supplies are being closely watched by both customers and rival exporters as an indication of the level of the sweetener available to the world market, and thus the potential for prices.
“The world sugar market supply is likely to remain tight,” the bureau said, although noting expectations from “industry contacts” that the “world sugar market should move from a roughly 1m-tonne surplus in 2021-22 to a 2.5m-3m-tonne surplus in 2022-23,” on October-to-September bases.