Cepea, April 17, 2020 – With 31% of the refineries from São Paulo State crushing the sugarcane from the 2020/21 crop in late March, some batches of crystal sugar Icumsa up to 180 were produced and supplied in the spot market in the first fortnight of April. Among the purchasers, packing companies traded the largest amounts, around 60% of the total marketed, followed by wholesalers, with 30%. As regards the industry (usually small and mid-sized refineries close deals in the spot market), some refineries interrupted purchases, implementing mandatory vacation to workers, due to the recommendations to avoid social contact in order to prevent covid-19 from spreading out. Thus, the participation of the industry in the total volume sold in the spot was lower, at around 10%.
However, isolated rain showers in some sugarcane crops that were being harvested in São Paulo State timely interrupted sugar production in the refineries that had already started crushing. This scenario helped to underpin prices, which oscillated from 76 BRL to 79 BRL per 50-kilo bag in the first fortnight of April. The number of sugar deals closed was low, but the volumes marketed ranged from medium to large.
Between March 31 and April 15, the CEPEA/ESALQ Index for crystal sugar (Icumsa 130-180 – São Paulo) rose 3.38%, closing at 78.20 BRL (14.94 USD)/50-kilo bag on April 15.
EXPORTS – In March/2020, Brazil exported 1.445 million tons of sugar, according to Secex, 12.03% more than that shipped in February (1.29 million tons). The revenue received from exports last month totaled 441.078 USD, 14.93% higher than that from February (383.764 million USD). Algeria was among the top purchasers of the Brazilian product in March, having imported 332.890 thousand tons, followed by Nigeria (151.119 thousand tons), India (139.450 thousand tons), Bangladesh (111.25 thousand tons) and Indonesia (95.243 thousand tons).
INTERNATIONAL MARKET – The global market expects Brazilian refineries to increase sugar production in the 2020/21 season, partly due to the low demand for ethanol. According to Agritel, Brazil may produce from 8 to 9 million tons more sugar in 2020/21 than it did in the previous season.