Prices remain stable and liquidity is low in the Brazilian market

Cepea, February 5 2019 – Crystal sugar prices increased slightly in January in the spot market of São Paulo State. Between December 28 and January 31, the CEPEA/ESALQ Index for crystal sugar (São Paulo), Icumsa color from 130 to 180, rose 1.4%, closing at 69.18 BRL (18.95 USD) per 50-kilo bag on January 31. Between January 2 and 31, the crystal sugar Index averaged 68.83 BRL (18.42 USD) per 50-kilo bag, practically stable (+0.38%) compared to that in December, at 68.57 BRL per 50-kilo bag.

 

Opposite to the current scenario, in January 2018 and 2017, sugar quotes were dropping. In the 2017/18 season (January/18), for instance, the average of the CEPEA/ESALQ crystal sugar Index, at 64.83 BRL per 50-kilo bag, was 11.82% lower than that in December/17, at 73.51 BRL per bag. In 2016/17, the price average in January/17, at 93.47 BRL per 50-kilo bag, was 4.8% lower than that in December/16, at 98.18 BRL per bag – prices were deflated by the IGP-DI from December/18.

 

The lower sugar production in the current season has underpinned prices in the spot market of São Paulo State. According to Unica (Brazilian Sugarcane Industry Association), from April/18 to December/18, sugar production in São Paulo State totaled 18.088 million tons, 25.96% less than in the same period of the previous year.

 

As for liquidity, sugar trades were at a slow pace in the spot market of São Paulo State in January. The amount of sugar supplied by refineries was not significant and demand was weakened. On the other hand, the delivery of the product previously purchased was at a fast pace.

 

(Cepea-Brazil)

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