Production grows in Brazil, but Index continues on the rise and hits 81 BRL/bag

Cepea, August 18, 2020 – Despite the higher sugar production this season, prices have been on the rise in the spot market of São Paulo State. In the first fortnight of August, the CEPEA/ESALQ Index for crystal sugar (São Paulo State) surpassed 80 BRL/50-kilo bag – on August 14, the Index closed at 81.43 BRL/bag (15 USD/bag), the highest nominal level in the 2020-21 season (which officially started in April/20).

 

Crystal sugar prices have been underpinned by the decision of the refineries in SP to reduce sales in the Brazilian market, primarily of higher quality sugar (Icumsa 150). In the international market, the valuation of demerara sugar encouraged Brazilian refineries to lower availability in the domestic market, since exports have been high this season.

 

Between July 31 and August 14, the CEPEA/ESALQ Index for crystal sugar (São Paulo State) rose by 3.8%, closing at 81.43 BRL (15 USD) per 50-kilo bag on August 14.

 

According to data from Unica (Brazilian Sugarcane Industry Association), from Apr/10 to July/20, the refineries from SP produced 13.631 million tons of sugar, 47.76% more than that in the same period last year. Of the total sugarcane volume processed in the state (197.209 million tons), 53.1% were allocated to sugar production and 46.9%, to ethanol production.

 

As regards parity, exports have been more advantageous than selling sugar in the domestic market.

 

(Cepea-Brazil)

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