The plants continue to allocate only around 35% of the cane to produce sugar, near the all-time record low, while all the rest is earmarked to produce ethanol due to better prices for the fuel in the Brazilian domestic market. In the first half of August, cane crushing, sugar and ethanol production were all up compared to the same period last season (see table below), possibly due to rains at this time last year.
Mills crushed 42.54 million tonnes of cane early in August, 26% more than in similar period last year. Sugar production was up 24% to 2.12 million tonnes, while ethanol production was up 20% to 2.39 billion liters, Unica said.
Initial projections of higher sugar production this year compared to last season seem now unlikely, Unica's technical director Antonio Padua Rodrigues said.
"With around 60% of the crop processed, we do not see an intensification of sugar production," he said, adding that cumulative sugar output for the season lags the previous crop by 1 million tonnes, an indication that Brazil will cut annual sugar exports for the second year in a roll. The Brazilian market for hydrous ethanol, a substitute for gasoline in flex-fuel vehicles, continues strong. Production of hydrous ethanol in the first half of August was a record for that period, at 1.66 billion liters.
Rodrigues said the quality of the cane continues to disappoint. Sugar content in cane early in August reached 146.23 kg per tonne on average, 5.87 kg less than last season. So, even if the cane crop is expected to be similar in size to the previous considering total crushed tonnage, recoverable sucrose that is converted to sugar and ethanol is likely to be smaller, Rodrigues said.