In six months, the Index varies only 4.3 percent

At the end of harvest activities in the Center-Southern region of Brazil, the domestic sugar market keeps the stable rhythm that has been observed since June. In these six months - comparing June 15th to Dec 14th - the CEPEA/ESALQ Index for crystal sugar (Sao Paulo state) dropped only 4.3 percent.

On Friday, Dec 14th, the Index closed at 23.74 reals or 13.21 dollars per bag of 50 kilos, upping 2 percent in Real over Nov 30th. Between Dec 10th and 14th, the anhydrous remunerated 24 percent more than the sugar and the hydrated, 16 percent. Regarding price parity, domestic trades (SP market) remunerated 2 percent more than exports in the same period.

The last Sao Paulo Sugar Cane Agroindustry Union (Unica) report about the 2007/08 crop (from April to December) did not surprise the sector - it was similar to those of November, but very different over the initial forecast.

The sugarcane production in the Center-Southern region totaled 425 million tons, increasing 14 percent over the previous crop. The sugar production was of 26.22 million tons, volume 1.63 percent superior to the previous crop. Of this total, 67.1 percent were destined to exports and 32.9 percent to the domestic market. The ethanol production totaled 19.78 billion liters. Ethanol exports amounted to 2.8 billion liters, a strong reduction of 17.65 percent over the previous season.

The percentage allotted to the ethanol was of 55.28 percent and to the sugar, of 44.72 percent. In the first estimation, the mix of production was forecasted at 47.43 percent for the sugar and at 52.57 percent for the ethanol, showing that the sugarcane surplus was destined to the fuel production. The reasons for this change were the crescent fuel demand and, for the sugar, the lower values in the domestic and international markets.

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