Index rises and hits 91 BRL/bag in the Brazilian market

Cepea, October 16, 2020 – The average price for the crystal sugar traded in the spot market of São Paulo State (SP) hit 90 BRL per 50-kilo bag in the first half of October, nominal level that had not been observed since late December 2016. Valuations are linked to the low supply in the Brazilian market, primarily of the Icumsa 150 type. With the low availability, some purchasers agreed to pay higher prices for lower quality sugar.

 

Between October 1st and 15, the CEPEA/ESALQ Index for crystal sugar (São Paulo State) averaged 90.22 BRL/50-kilo bag, 5.1% higher than that in first fortnight of September.

 

Brazilian sugar exports have been firm in the 2020/21 season, favored by the strong dollar. Although crystal sugar prices have been around 90 BRL/bag, international valuations of demerara sugar led remuneration from exports to become higher than that in the spot market of SP again. It is worth to mention that remuneration in the domestic market had been higher since late August.

 

Between October 5 and 9, the weekly average of the CEPEA/ESALQ Index for crystal sugar was 90.13 BRL (16.15 USD/bag) per 50-kilo bag, while the March/21 contract at ICE Futures was 90.62 BRL per bag. Thus, remuneration from exports were 0.54% higher than that in the spot market of SP. This figure considered weekly averages at 40.04 USD per ton of freight and charges, 33.47 USD per ton for quality premium and dollar at 5.5796 BRL.

 

According to Secex (Foreign Trade Secretariat), in September, Brazil exported 3.618 million tons of sugar, 111.83% more than the volume shipped in Sept/19 (1.708 million tons). Revenue totaled 1.011 billion USD.

 

(Cepea-Brazil)

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