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, an independent analyst said on Thursday.
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 long period without or insufficient rainfall in the main producing regions in the center-south has caused stress on the cane fields and begun to make cane growers to worry about them," said Archer's chief analyst Arnaldo Correa. "The damage in some specific regions is alarming," he 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.
Comments
Comments are closed for this article.