September 11, 2012 / 5:50 PM / 7 years ago

UPDATE 2-Brazil sugar mills keep pedal to metal in record August

* Center-south mills set second straight sugar output record

* Mills favoring sugar over ethanol due to returns

* Full-season output still trails same period last year (Adds context)

SAO PAULO, Sept 11 (Reuters) - Perfect weather in the second half of August allowed Brazil’s center-south cane mills to hit a second straight record fortnight, churning out 3.34 million tonnes of sugar, up 12.4 percent from a year earlier, industry association Unica said on Tuesday.

Cane crushing was up 14 percent to a record 46.5 million tonnes, and ethanol output surged 10 percent over the period. But overall crush, sugar and ethanol output numbers for the season that began in April all remain down from last year due to a wet May and June that forced mills to shut down harvest for several days.

After weather cleared in July, the center-south has churned out nearly 12 million tonnes of sugar since the start of July, or 64 percent of the sweetener produced this season. Since April the region has put out 18.7 million tonnes, down 8.7 percent from the same period a year before.

The center-south accounts for 90 percent of sugar output in Brazil, the world’s largest producer.

Weather has yet to show signs of breaking the pattern. Brazil is in the tail end of its dry season when mills intensify harvest. Despite a weak cold front that should pass over the cane belt in late September, no change in the overarching dry pattern is in store until at least October.

This will give mills a fighting chance at setting more records this month before rains set in and they could whittle down the amount of cane that might get left in the fields for next season’s crush.

Sugar futures have recovered slightly from last week to just under 19.5 cents a pound, despite the rapid pace of harvest in Brazil.

Analysts estimate that many producers with higher costs than Brazil remain profitable at current prices, including Thailand and Australia.

Mills allocated 51.6 percent of their cane to sugar production in late August, up from 51.2 percent in the same period last year. The remaining 48.4 percent of the cane went to ethanol production in August.

Mills can divert as much as 60 percent of their cane to ethanol production, but they are just about at their maximum output for sugar at the moment.

Mills are racing against the return of spring rains that are expected in the coming months and would hamper their harvesting work and eventually will force them to shut down until around April next year.

Mills say they have enough cane to crush through December. Some analysts say mills may have to leave some mature cane unharvested until next season if they can’t get to it before the rains intensify in the coming months. (Reporting by Reese Ewing; Editing by David Gregorio, Gerald E. McCormick and Steve Orlofsky)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below