Cosan plans increasing sugar cane crushing capacity in its plants
Valor Econômico
Still much ahead the second place in sugar cane crushing capacity, Cosan Açúcar e Álcool enters the 2010/11 harvest with the radar on for what is going on around it. And that means that, unless there are opportunities that bring it great synergy, major acquisitions of plants are not on sight in 2010. Even because the good moment sugar is experiencing, which should last until 2011, and also the moment the alcohol is going through, has been taking the prices of the assets upwards and creating few real opportunities. "A new strong expansion in sugar and alcohol shall only occur in the next cycle of low production", says Peter Mizutani, CEO of Cosan Açúcar e Álcool.
The year is thus of consolidation of the current assets and maintenance of the already started investments. A project that is already planned to begin in the 2010/11 harvest-year, which starts in April, is the increase of the capacity of its current facilities. The current 63 million tons (225 days of crushing) of capacity have potential to get to 70 million only with the increases, according to Mizutani. The project will be developed over the next five years, period in which the company should invest R$ 100 (US$ 55.6) per ton of increased capacity, amounting to nearly R$ 700 million (US$ 388.9 million).
"The area of logistics has strong profitability potential in the short term and should receive more investments", says Mizutani. This project will begin having results in the 2010/11 harvest, allowing Cosan to produce from 8% to 10% more sugar than in the previous cycle. In the 2010/11 season, Cosan foresees producing 4.6 million tons of sugar, compared to the 3.72 million of the 2009/10 cycle. The production of alcohol should get to 2.1 billion liters compared to the 1.93 billion of the 2009/10 harvest.
Also, 2010 should see the continuation of the energy cogeneration project, which started in 2005 with the forecast of R$ 2.4 billion (US$ 1.3 billion) in investments and the goal to reach 12 of the 23 plants of the group and a production of 2.5 thousand megawatts/hour, enough to supply electricity to a 10-million-inhabitant-city for one year. Until the end of the third quarter of the 2009/10 harvest, R$ 264.4 million (US$ 146.9 million) had been invested in such project. Seven plants of the company already have cogeneration units and another three will go into operation in 2010/11.