SAO PAULO, June 24 (Reuters) - Brazilian ethanol exports from the center-south could rise this season by at least 50 percent over last year’s crop as U.S. demand for the biofuel surges, a top sugar and ethanol trading group said on Tuesday.
Shipments of Brazilian ethanol to the U.S. have become feasible despite a 54-cent-a-gallon import tariff after floods destroyed some of the U.S. corn crop used to make ethanol, driving up the price of both corn and ethanol in the U.S.
“Total exports could reach 4.5 billion to 5 billion liters ... due mainly to the increase in U.S. ethanol prices,” said Soren Jensen, international trading manager at Copersucar, one of Brazil’s largest sugar and ethanol trading groups.
The South American nation is the world’s largest ethanol exporter and the United States is its main customer. Last year the centre-south region, which grows most of the country’s cane, exported 3.1 billion liters of ethanol.
Brazil’s Cane Industry Association (Unica) estimated on Monday that shipments of ethanol from the centre-south would reach 5 billion liters.
Jenson said the amount of ethanol exported depended more on how much Brazil could produce and its transport infrastructure could handle rather than how much the United States needed since its demand was strong.
“Exports this season will rise by at least 50 percent, possibly 60 or 70 percent,” he said during an agribusiness seminar in Sao Paulo.
Brazil’s center-south is in the middle of a record harvest which could yield half a billion tonnes. Almost 60 percent of the crop has been diverted to ethanol due to poor profit margins in sugar. (Reporting by Inae Riveras; Editing by Peter Murphy and Christian Wiessner)