Sugar commerce in Brazilian hands
Valor Econômico 03/25/2009
Left to a second plan in the last four years due to the boom of investments in ethanol, sugar is again turned into the great bet of the sugar and alcohol sector for the 2009/10 harvest. The Brazilian participation in the exports of sugar must jump from the current 42.35% in the 2008/09 cycle to 50% of the market in the new harvest, according to Datagro. Since the horizon for fuel alcohol is not cheerful at short term, with prices declining even out of the season period, the Midwestern and Southern plants shall increase the production of sugar with an eye on the international market, since India, the second largest producer and greatest world consumer shall increase its imports in the next months.
While the prices of ethanol undergo a fall of 13.2% since the beginning of the year, the appreciation of sugar in the domestic market accumulates a 48.7% increase, according to a survey of the Cepea (Center for Advanced Studies on Applied Economics). The mix of production of the Midwestern and Southern plants for the next harvest is estimated at 56.5% for ethanol and 43.5% for sugar. In the current cycle, which ends this month, it was at 59.1% for alcohol and 40.9% for sugar, affirmed Guilherme Nastari, of the Datagro. According to Nastari, the space left by alcohol will be occupied by sugar, aimed at the export to other countries. According to Paulo Roberto de Souza, Copersucar commercial and logistics officer, the share of Brazil in the global exports of sugar should get to up to 60% in 2020, considering a world growth of 2% a year in the production of the commodity.