AGL 40.40 Increased By ▲ 0.20 (0.5%)
AIRLINK 129.25 Increased By ▲ 0.14 (0.11%)
BOP 6.81 Increased By ▲ 0.21 (3.18%)
CNERGY 4.13 Increased By ▲ 0.10 (2.48%)
DCL 8.73 Increased By ▲ 0.28 (3.31%)
DFML 41.40 Increased By ▲ 0.15 (0.36%)
DGKC 87.75 Increased By ▲ 0.75 (0.86%)
FCCL 33.85 Increased By ▲ 0.50 (1.5%)
FFBL 66.40 Increased By ▲ 0.50 (0.76%)
FFL 10.69 Increased By ▲ 0.15 (1.42%)
HUBC 113.51 Increased By ▲ 2.81 (2.54%)
HUMNL 15.65 Increased By ▲ 0.42 (2.76%)
KEL 4.87 Increased By ▲ 0.09 (1.88%)
KOSM 7.62 Decreased By ▼ -0.21 (-2.68%)
MLCF 43.10 Increased By ▲ 1.20 (2.86%)
NBP 61.50 Increased By ▲ 1.00 (1.65%)
OGDC 192.20 Increased By ▲ 9.40 (5.14%)
PAEL 27.05 Increased By ▲ 1.69 (6.66%)
PIBTL 7.26 Increased By ▲ 1.00 (15.97%)
PPL 150.50 Increased By ▲ 2.69 (1.82%)
PRL 24.96 Increased By ▲ 0.40 (1.63%)
PTC 16.25 Increased By ▲ 0.01 (0.06%)
SEARL 71.30 Increased By ▲ 0.80 (1.13%)
TELE 7.25 Decreased By ▼ -0.05 (-0.68%)
TOMCL 36.29 Decreased By ▼ -0.01 (-0.03%)
TPLP 8.05 Increased By ▲ 0.20 (2.55%)
TREET 16.30 Increased By ▲ 1.00 (6.54%)
TRG 51.56 Decreased By ▼ -0.14 (-0.27%)
UNITY 27.35 No Change ▼ 0.00 (0%)
WTL 1.27 Increased By ▲ 0.04 (3.25%)
BR100 9,967 Increased By 125.2 (1.27%)
BR30 30,751 Increased By 714.7 (2.38%)
KSE100 93,292 Increased By 771.2 (0.83%)
KSE30 29,017 Increased By 230.5 (0.8%)

Mills in Brazil's center-south are likely to start harvesting the new sugar cane crop later than usual to allow cane fields to take advantage of late rains while holding excess ethanol stocks after over-producing last year, analysts and millers said.
Brazil's 2019/20 cane crop in the main center-south region officially starts in April, but mills normally enter fields in March, particularly to profit from better ethanol prices at the end of the inter-harvest period. Ethanol stocks in the region are still at a near-record high, however, because of the mills' strategy last year to favor the biofuel over sugar. Ethanol prices did not rise in the between-crops period as they historically do, further reducing the incentive for early harvesting.
Brazil's Sao Martinho, one of the largest companies in the sector, said around 38 percent of its annual ethanol output remains to be sold in the last quarter of the crop year, which runs from January to March. "Our expectation was for higher ethanol prices in December, January and February, which didn't happen," said Felipe Vicchiato, the company's chief financial officer.
Brazil is the world's largest producer and exporter of sugar and the largest producer of cane-based ethanol, though it is second overall after the United States, which makes its ethanol from corn. Matheus Costa, sugar & ethanol analyst at broker and consultancy INTL FCStone, also said Brazil's ethanol stocks remain high.
"If mills face difficulties to reduce those stocks, they could opt to produce more sugar than ethanol in the beginning of the new crop, or they could choose to delay the start of harvesting," he said. Some companies, such as Louis Dreyfus-controlled Biosev, want to give cane fields time to benefit from recent rains, especially since precipitation was below average in December and January.
"We are having good rains now, and there is more expected for the rest of the month. Our plan is to not start crushing in March, only in April," Biosev's Chief Executive Juan José Blanchard told Reuters. If rains continue into March, overall volumes for the new cane crop could improve even if mills delay processing. Some analysts think the sugar market is already reacting to a possible delay in the new center-south crop.

Copyright Reuters, 2019

Comments

Comments are closed.