Raizen Energia SA, the world's largest sugar maker, ended 2017-18 cane crushing at its Santa Helena mill, in Brazil's main cane belt, on Tuesday, ahead of the original schedule, a source with knowledge of the company's operations told Reuters on Wednesday. Raizen, a 50-50 joint venture between Cosan SA Industria e Comercio and Royal Dutch Shell Plc, originally expected Santa Helena to end crush on November 4, but insufficient cane supplies in the region where it is located, in Sao Paulo's Piracicaba region, altered those plans.
The source requested anonymity, not wanting to speak publicly about the firm's strategies. Raizen declined to comment. "The mill ended crushing almost three weeks before planned, due to lack of supplies," said the source, saying the strong dry spells first in July and then in August/September reduced cane volumes, despite increasing sugar content.
"It is a trend (early end to cane crushing). It is going to happen to more mills in the market," the source said. The source declined, however, to discuss if the early end to crushing at Santa Helena and possibly in other units could cut Raizen's guidance to crush 60 million tonnes of cane in the current crop.
Santa Helena is a smaller unit compared with most other Raizen mills, with a capacity to process 1.5 million tonnes of cane per year. A day earlier, French sugar group Tereos had said it would end cane crushing in Brazil, where it operates seven mills, in November, not advancing to December as it normally does.
Jaime Stupiello, an agriculture director at Tereos in Brazil, said the long dry periods led to a quicker crushing pace at mills, probably allowing the industrial installations to finish processing cane earlier. Brazil's center-south is expected to process between 580 and 590 million tonnes of cane in 2017/18, analysts said, less than the 607 million tonnes seen in the previous season. Broker and analyst INTL FCStone cut last month its projection for the current crop from 588 million tonnes to 584 million tonnes, citing drier-than-normal weather.