Early projections for Brazil's 2017/18 sugar cane crop are varying widely amid heavy rains in the center-south cane belt, leaving commodities traders uncertain about how much sugar the world's top producer will make as harvest time approaches.
Extremely beneficial weather for cane development in January, which remains in place in the first days of February, seems to be impacting some analysts calculations. The projections, which were pretty much in a consensus late last year, are wide apart now.
Two of the top consultancies in the sector, for example, S&P Global Platts and Datagro, are separated by 30 million tonnes in their first estimates for the new center-south cane crop, an amount similar to what countries such as Australia or Indonesia, among the ten largest growers, would produce in the whole crop year.
The global sugar market is expected to come out of a two-year deficit in the coming crop. The recent production shortage sent raw sugar prices to the highest levels in almost five years. The amount of sugar coming out of Brazil is the main factor behind traders' projections on the global sugar balance.
"The numbers released so far are an eloquent proof of how sharply different current views are regarding the season that is going to start," Arnaldo Correa, a sugar expert at Sao Paulo-based Archer Consulting, said.