Liquidity is low, but prices rise in Brazil in August

Cepea, September 3 2019 – The amount of crystal sugar traded in the spot market of São Paulo State decreased in the second fortnight of August. This scenario may be linked to the large volumes sold between July and the first ten days of August, which lowered refineries’ needs for cash flow. The larger volume of sugarcane allocated to ethanol production also lowered crystal sugar supply in the spot market.

 

Still, quotes increased in the accumulated of August (July 31 to August 30). The strong US dollar, which encourages Brazilian sugar exports, may have led domestic purchasers to close new deals for export. Concerning refineries, most of them did not lower asking prices, underpinning quotes. Thus, the CEPEA/ESALQ Index for crystal sugar (São Paulo State) closed at 61.26 BRL (14.83 USD) per 50-kilo bag on August 30, 4.4% up compared to that on July 31.

 

In August/19, the Index averaged 60.07 BRL per bag, 0.62% up compared to that in July/19 (59.70 BRL per bag). In the 2019/20 season (April/19 to August/19), average sugar quotes have been higher than that in the same period last season (2018/19), in real terms.

 

(Cepea-Brazil)

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