Forecasts that this season’s Brazilian cane crush will extend longer than the last one began to crystalise as data showed mills’ sugar production soaring by 59% year on year, despite “consistent” rains.
Mills in Brazil’s Centre South region, which is responsible for some 90% of the country’s sugar output, produced 1.83m tonnes of the sweetener in the first half of this month, up from 1.15m tonnes in the same period of October 2021, industry group Unica said.
The expansion reflected a 41% increase to 27.7m tonnes in the volume of cane processed, compared with last year, when mills started early their seasonal wind-down of crushing operations, as drought- and frost-depressed cane supplies began to run low.
Indeed, the crushing improvement seen this time was “partly due to the early closure of mills in the past harvest on account of climatic adversities that severely hampered the development of the crop”, Unica said.
The number of mills closing operations for the season as of October 16 stood at 31 this year, less than half the 73 plants shut down as of the same date in 2021.
Cane crush volumes in the first half of this month would have been even greater were it not for rains hindering fieldwork.
“Harvest operations were hampered in the first half of October due to a consistent rainfall regime in the sugarcane producing regions,” including in southern Sao Paulo, the top growing state.
Investors had expected mills to crush 29.9m tonnes of cane in the period, and produce 1.95m tonnes of sugar, according to a poll by S&P Global Commodity Insights.
The data come amid a market debate on how much cane Centre South mills will be able to process in 2022-23, as started in April.
Forecasts for the crush have remained relatively unchanged through the season, at roughly 550m tonnes, up by some 25m tonnes year on year.
That would imply mills crushing a further 90m tonnes of crop in what remains of this season, compared with less than 40m tonnes processed over the same period of 2021-22.
Unica said that this season’s crush was running about 30m tonnes behind the typical pace – a lag that could be closed “subject to weather conditions”.
Although the Centre South crush season does not officially close until March, mills usually close about four or five months earlier, late in the calendar year, when rainfall levels typically begin to build.
Cofco, the Chinese ag trading giant, on Monday forecast that Centre South mills will crush 550m tonnes of cane this season, but added that this would still mean leaving some crop in the field.
Unharvested crop can be carried over into the next season, as so-called “bisada” cane.
New York raw sugar futures for March stood 0.1% higher at 18.14 cents a pound in late deals in New York, little changed from before the Unica report.
For GrainPriceNews analysis of the Unica report, click here.