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The Brazilian government on Thursday scaled back its projections for center-south sugar and cane-based ethanol production in the current crop, despite expectations for a slightly larger crush, blaming lower sugar content in the cane. The country's center-south region is expected to produce 28.97 million tonnes of sugar in 2019-20, compared to 31.44 million tonnes projected in May, according to a report by agricultural statistics agency Conab. The region is expected to crush 571 million tonnes in the period, 5 million tonnes more than previously estimated.

Conab revised down its projection for cane-based ethanol production in the center-south to 28.1 billion liters from 29.6 billion liters in May. But it said Brazil's total corn-based ethanol production would surge 70% in 2019-20 to 1.35 billion liters, as more projects come onstream. The fact that center-south sugar and ethanol production figures were revised down despite the expectation of a larger cane crop could be the result of lower sugar content in cane, Conab analysts said.

Conab cut its view for total recoverable sugar in cane from 138.7 kg per tonne in May to 137.2 kg per tonne now, saying that aging fields, along with problems with cane flowering, reduced the capacity of plants to accumulate sugar. "ATR (sugar content) should be smaller this crop, a result of lower cane quality," said Conab's Cleverton Santana, who oversees the report.

Brazil's total cane area, including production in northern regions as well, is expected to fall 2.4% in the 2019-20 crop to 8.38 million hectares, the 3rd consecutive year of decrease, as other crops such as soybeans and corn continue to expand over once-traditional cane regions.

Copyright Reuters, 2019


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