Brazil's sugarcane crop views vary widely on heavy rain

Early projections for Brazil's 2017/18 sugar cane crop are varying widely amid heavy rains in the center-south cane belt, leaving commodities traders uncertain about how much sugar the world's top producer will make as harvest time approaches. Extremely beneficial weather for cane development in January, which remains in place in the first days of February, seems to be impacting some analysts calculations. The projections, which were pretty much in a consensus late last year, are wide apart now.
Two of the top consultancies in the sector, for example, S&P Global Platts and Datagro, are separated by 30 million tonnes in their first estimates for the new center-south cane crop, an amount similar to what countries such as Australia or Indonesia, among the ten largest growers, would produce in the whole crop year.
The global sugar market is expected to come out of a two-year deficit in the coming crop. The recent production shortage sent raw sugar prices to the highest levels in almost five years. The amount of sugar coming out of Brazil is the main factor behind traders' projections on the global sugar balance.
"The numbers released so far are an eloquent proof of how sharply different current views are regarding the season that is going to start," Arnaldo Correa, a sugar expert at S?o Paulo-based Archer Consulting, said.
There was a consensus late last year that cane production in 2017 would be smaller than in 2016, mostly due to insufficient renovation of fields and climate adversities in the first half of last year, such as the April frosts. But recent weather seems to have changed that. "Cane reacts very well to rainy weather," Antonio Cesar Salibe, executive president of cane industry group Udop, said. "Its been raining almost everyday, so we can expect a positive impact," he said.
According to Sao Paulo-based meteorologists Somar, the top cane region of Ribeir?o Preto received 365 millimeters of rain in January compared to a 30-year average of 309 millimeters. The same region received 99 millimeters of rain in the first seven days of February, or half the amount expected for the whole month. "Climate models are oscillating a lot. The (drier) La Nina phenomenon did not materialized and now we are expecting a weather closer to normal, but with above normal rains," Somar meteorologist Nadiara Pereira said.