Brazil's center-south cane crush sped up in the second half of March boosted by favourable dry weather, industry group Unica said on Tuesday. More than 130 mills were operating in the region, compared with only 58 at this time last year. They crushed 14 million tonnes of cane in the second half of March versus 5.26 million tonnes in the first half of the month.
Unica said sugar production in the period reached 461,200 tonnes, advancing quickly from the 139,900 tonnes seen early in the month. Last year at this time the region produced 165,900 tonnes of sugar. Ethanol output reached 581.5 million liters late in March, versus 222.4 million liters in the first half of the month. The volume was more than double the output seen in the same period a year ago.
"The sizable amount of cane left in the fields last year, the need to generate quick cash and the drier weather favoured cane crushing in March", said Unica's director Antonio de Padua Rodrigues in a statement. Unica numbers seem to confirm, at least in this early stage of the new season, market expectations for a change in the production mix in favour of more sugar output.
The mix in the second half of March showed 33.4 percent of the raw material earmarked for sugar production and 66.6 percent for ethanol. At this time last year the mix was 29.4 percent for sugar and 70.6 percent for the biofuel. Mills favour ethanol production early in the season because the available cane usually lacks higher concentrations of sugar. The concentration increases later as plants mature. Unica said ethanol sales in March were 13 percent lower than in the same month last year, as Brazil's worst recession in decades and high ethanol prices hurt demand.
Padua said that fuel retailers are not passing on to consumers price reductions already made at mills. Unica gave final numbers for the 2015/16 crop, which technically ended on March 31, although mills were already operating in a new-season mode. Brazil's center-south 2015/16 final crush number was 617.7 million tonnes, compared to an initial estimate by Unica in May of 590 million tonnes. Sugar production in 2015/16 stood at 31.2 million tonnes, versus 31.8 million tonnes initially projected.