Brazil's center-south cane crop cut due to drought

21.05.2018

Brazil's center-south, the world's largest sugar producing region, is likely to have less cane to process this year than previously expected due to a prolonged period without widespread rains.

It is reported by Reuters.

Sao Paulo-based Archer Consulting revised its center-south 2018/19 cane crop projection to 563 million tonnes, compared to 580 million tonnes expected previously, citing damage to some cane fields in the region due to drought.

«The damage in some specific regions is alarming», — it added.

It said sugar production would likely reach only 28,5 million tonnes, instead of the 30,5 million tonnes expected before. If confirmed, Correa said it would be center-south's smallest sugar production since the 2009/10 crop.

Archer is the first independent analyst in Brazil to cut its projection due to the drought.

The dryness was a hot issue during last week's ISO Datagro Sugar and Ethanol Conference in New York. However, some market participants were reluctant to revise projections yet, since cane is usually very resistant to dry weather and there is potential for a recovery if rains come.

Archer also slightly revised its ethanol estimate, now seeing total output at 26,39 billion liters vs 26,5 billion liters previously. It said mills are likely to allocate only 39,9% of cane to sugar production.


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