A number of Brazilian sugar and ethanol firms still face tough financial conditions as heavy debt loads limit investments that could improve their returns, mills and consultants said on Monday. While large groups such as Raazen, Biosev and Sao Martinho could tap alternative sources of financing, most mid-sized firms took on more debt over the last few years and are struggling to crush more cane, the experts said during F.O. Licht's international sugar seminar in Sao Paulo.

Reberth Machado, chief executive of Bioenergia do Brasil SA, said his firm's situation illustrates the industry's current predicament. Its debt rose to 246 million reais ($78.6 million) from 157 million reais roughly three years ago. Bioenergia decided earlier this year to stop paying its debt with banks and funds such as US-based Amerra Capital Management LLC, said Machado, and sought restructuring talks with creditors.

Copyright Reuters, 2017