Home Agribusiness Brazilian 2017/18 Sugarcane Harvest in SP Finished with Lower Real Prices

Brazilian 2017/18 Sugarcane Harvest in SP Finished with Lower Real Prices



The 2017/18 sugarcane harvest in São Paulo ended with lower real prices than the previous season, for both anhydrous and hydrated ethanol. From April / 17 to March / 18, the monthly CEPEA / ESALQ Indicator of hydrated ethanol decreased by 3.61% (values ​​deflated by the IGP-M of Feb / 18), averaging R $ 1.5939 / liter (without ICMS and without PIS / Cofins). The monthly CEPEA / ESALQ indicator of anhydrous ethanol closed with a decrease of 4.11%, in real terms, with an average of R$ 1.7633 / liter (without PIS / Cofins) in the same period.

Hydrated ethanol prices were up at the close of Mar. 18th, pressured by the increase in the supply of the 2018/19 crop in the São Paulo market. Buyers followed with low buying interest, acquiring only spot volumes, due to the expectation of lower prices with the entrance of the new harvest. In the case of anhydrous ethanol, there was demand for the product of São Paulo, in order to supply the markets of the Northeast and the Midwest – despite the high cost of freight, SP product prices were still attractive to buyers.

In this scenario, the average prices for the full weeks of March for hydrous ethanol in the state of São Paulo were R $ 1.8614 / liter, slightly higher than 0.15% compared to February. For anhydrous ethanol, in turn, there was a fall of 1.38% in the same comparison, closing at R $ 1.9276 / liter in March – both indicators considering only the spot market.

Parity continues to favor biofuels only in the states of Goiás and Mato Grosso, with an average of 68.5% and 62.7% respectively, according to the National Petroleum Agency (ANP). In the state of São Paulo, the average fuel ratio was 72% in March / 18.

Sugar: India’s production reaches 30m t in 2017

Sugar production in India in the 2017/2018 crop reached 29.98 million tonnes by Sunday, April 15, according to the Indian Sugar Mills Association (Isma), the country’s mill association. The volume already exceeds in almost 500 thousand tons the entity’s production estimate for the period 2017/2018, of 29.5 million tons, made in March of this year. Production also exceeds the consumption of 25 million tonnes forecast for the period between October last year and September of this year by 5 million tonnes.

According to Isma, 277 plants processed the crop until April 15, but the last 15 days several industrial plants closed the harvest, with an impact on production. The agency cited in a report that some measures were attempted by the government to minimize the decline in sugar prices such as inventory formation, zero export tax and increased export tax. “Despite these steps, sugar prices continued to fall and the pace of the decline only increased recently, causing more difficulties for sugar mills and sugarcane producers, “Isma said.

The announcement further weakened the future sugar business on the New York Stock Exchange (ICE Futures US). Earlier, the July contract traded more than 12 cents per pound and reached a low of 11.96 cents, down 21 points from yesterday’s closing at 12.1 cents. The contract may have hit 11.81 cents a barrel, down 17 points from yesterday’s close