Sugar-Alcohol Plants Prioritize Sugar Production Due to High Competition and Attraction in Export Market

Written by Roberta Souza

Published on 16/10/2020 at 14:38

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The Mills, Even with the Depreciation of the Real Against the Dollar, Prioritize Sugar Production Due to the Great Market Abroad

With the difficult logistics at the ports and the long queues for loading, the depreciation of the real against the dollar makes sugar highly competitive and attractive in the external market. In order to minimize the impact of the price and quantity crisis affecting the biofuels market, sugar and ethanol industries are betting a large part of their production capacity on sugar and strengthening commodity sales to the international market.

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Compared to ethanol, sugar production continues to grow. The latest data from the Sugarcane Industry Union (Unica) shows that the amount of sugarcane processed for sugar production increased from 35.43% to 47%. The accumulated harvest was 499.77 million tons, a 5.3% increase compared to the same period last year.

Last year, this strategy yielded positive results. In 2019, the country shipped 17.8 million tons of products. Now, in just the first eight months, external sales slightly increased to 17.9 million tons. Compared to the first eight months of this year, the growth reached 64%. Just in August, there was a 118.8% increase compared to the same month in 2019.

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Antonio de Pádua Rodrigues, technical director of Unica, stated in a note that “The drier weather brings some difficulties for productivity, but it also contributes to faster harvesting, which explains the 5.3% increase,” he reported. The commodity’s production from the beginning of the harvest until September is already at 31.950 million tons, a rise of 46.23%, or 10 million tons. “Of the total increase, about 7.40 million comes from the change in the production mix, while the other 2.70 million result from advances in milling and the better quality of the harvested raw material.”

According to data from the United States Department of Agriculture (USDA), Brazilian sugar exports are expected to reach a record 32.02 million tons in 2020/21, a 66% increase compared to the previous year.

The industry’s preference for sugar has led to a 7.47% decrease in ethanol production, which was 23.446 billion liters, comprising 16.298 billion liters of hydrated ethanol, supplied directly for vehicles, and 7.148 billion liters of anhydrous ethanol, mixed with gasoline.

Sugar-Alcohol Plants Prioritize Sugar Production Due to High Competition and Attraction in Export Market

The Mills, Even with the Depreciation of the Real Against the Dollar, Prioritize Sugar Production Due to the Great Market Abroad

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Sugar-Alcohol Plants Prioritize Sugar Production Due to High Competition and Attraction in Export Market

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