Cepea, February 19, 2021 – Although sugar supply was low in the spot market of São Paulo State (SP) in the first fortnight of February, the average prices for crystal sugar dropped. This scenario is linked to the demand for the product, which was low along the first half of the month.
Between January 29 and February 12, the CEPEA/ESALQ Index for crystal sugar (São Paulo State) dropped 3.4%, closing at 104.92 BRL per 50-kilo bag on February 12.
Despite the devaluations, the current prices for crystal sugar are higher than that in the 2019/20 season and offseason. This scenario results from the exports increase in the 2020/21 season. According to Secex, in January/2021, Brazil exported 2.095 million tons of sugar, 31.17% up from that in January/2020 (1.597 million tons).
Abroad, prices were firm in the first half of February. Lower supply for the short term because of the offseason in central-southern Brazil and lower production in Thailand and the European Union underpinned quotes. Besides, India was facing a lack of containers, which limited its sugar exports.
High gasoline prices in Brazil pushed up sugar quotes in the international market, since it boosted the demand for ethanol, leading plants to prioritize ethanol production rather than sugar. According to Unica (Brazilian Sugarcane Industry Association), ethanol sales in the second fortnight of January were higher than that in the same period of the previous season.