Brazil's sugar production up 16pc; ethanol sales down 13pc

SAO PAULO/NEW YORK: Mills in Brazil's centre-south region produced 2.93 million tonnes of sugar in the second half of August, 16% more than in the same period a year earlier, industry group Unica said on Thursday.

Brazilian mills continue to prioritize sugar production at the expense of ethanol, since the sweetener is currently providing higher financial returns and the market for the biofuel has yet to recover from the coronavirus pandemic.

Ethanol sales are lagging last year's levels. Mills sold 2.69 billion liters in August, 13% less on a year-on-year basis. Production of the biofuel fell 21% late in August to 2.16 billion liters.

Unica's technical director, Antonio de Padua Rodrigues, said ethanol exports had increased 25% so far in the season, which helped to partially offset smaller sales in the domestic market. A significant part of the exports, he said, was for medical use and not fuel.

Cane crush in the region was seen at 42.11 million tonnes late in August, 12% less than in the same period a year earlier, as rains in some producing areas reduced the harvest pace, Unica said.

Rodrigues said, however, that the main Ribeirao Preto producing area continued to be very dry, what could impact agricultural yields later in the season.