Brazilian sugar prices have been moving down, pressured by the higher supply, even with the off-season period. Some mills were focused again on the domestic market, due to the lower international values. Buyers, in turn, were more willing to trade, however they settled only few volumes. Most part of them is betting on new devaluations to trade larger quantities.
The CEPEA/ESALQ Index for crystal sugar (Sao Paulo state) averaged 16.79 dollars per bag of 50 kilos this Wednesday, Feb 7, decrease 1.41 percent over Jan 31st. In January, the Index averaged 17.19 dollars, unchanged over December 2006. Comparing the Index averages, in nominal terms, in January of 2006 with the same period of this year, there is a devaluation of more than 22 percent.
According to the Sao Paulo Sugar Cane Agroindustry Union (Unica), sugar prices should not increase in 2007, due to the expectation of larger supply, not followed by the demand. The 2007/08 crop should be a record again, with an increase of 12 percent in the Center-South sugarcane production.