Center-South Brazil H1 June sugar output falls 14.35% on year

Sugar production in Brazil's Center-South for the first half of June totaled 2.192 million mt, a drop of 14.35% from the prior year, data from trade association UNICA showed June 25.

The figure was below the consensus expectations of 2.472 million mt from 11 analysts S&P Global Platts surveyed June 22.

Mills in CS Brazil crushed 35.96 million mt of sugarcane in H1 June, down 14% year on year, UNICA said.

Sugar's share of the sugarcane crush for H1 June was 46.25% compared with 47.06% a year earlier.

"Sugar's share of the crush in H1 June was in-line with most analysts' expectations, but the amount of sugar cane crushed was much lower than anticipated because of heavy rainfall in the Southeast causing mills to shutter production for a few days," said a Sao Paulo-based trader. "Acute periods of intense rainfall in the Center-South during a fortnight can drastically reduce the accuracy of cane crush estimates."

The cumulative sugar crush in CS Brazil since April 1 was up to 165.59 million mt through H1 June. April 1 was the beginning of the 2021-22 crop year. This figure was down 11.58% compared with the same period in the 2020-21 crop year.

Sugar production since April 1 reached 9.344 million mt or a decrease of 11.90% from the same period in the 2020-21 crop year.

A total of 249 mills were operating as of June 16, down five from the same period of 2020. There were 241 mills processing sugarcane, five processing corn ethanol, and three flex mills operating. Market participants expect another six mills to begin operating in H2 June.

Total recoverable sugar, or ATR, in H1 June was 138.35 kg/mt, up 1.34% year on year.

Ethanol production, sales

Ethanol production in CS Brazil was 1.69 billion liters in H1 June, down 8.70% from a year earlier, UNICA said. Hydrous ethanol production accounted for 975 million liters of the total, down 23.99% on the year. Anhydrous ethanol output was at 711 million liters, up 26.11% on the year, it said.

The anhydrous share of total ethanol produced was 42.2% in H1 June, up from 40.3% in H2 May, according to UNICA.

Between the start of the 2021-22 harvest and June 16, ethanol production totaled 7.53 billion liters, with 4.96 billion liters of hydrous ethanol and 2.56 billion liters of anhydrous ethanol being produced.

Corn ethanol production in H1 June was 119.71 million liters, with 78.11 million liters of hydrous ethanol and 41.60 million liters of anhydrous ethanol being produced.

Ethanol sales by mills in CS Brazil during H1 June were 1.19 billion liters, 0.14% lower year on year, with 1.12 billion liters going to the domestic market and 64.08 million liters for export.

The quantity of hydrous ethanol sold to the domestic market during H1 June was 702.98 million liters, up 5.97% on the year. The quantity of anhydrous ethanol sold to the domestic market during H1 June was 419.90 million liters, 31.59% higher on the year.

Since the beginning of the 2021-22 harvest, cumulative sales of ethanol in the region totaled 5.81 billion liters, or an increase of 11.60%, from the same period last year.

Ethanol for non-fuel purposes sold in H1 June was 47.3 million liters, a decrease of 26.16% year on year. The drop in non-fuel ethanol sales was driven by weaker demand for hand sanitizer, UNICA said.