BRAZIL: UNICA says crush remained week during second half of June
Published: 07/13/2012, 8:31:50 AM
UNICA says Sugar and ethanol production in Brazil's key centre-south region remained weak during the second half of June as unseasonal rains diluted sugarcane and continued to slow the harvest, according to Dow Jones.
Mills in the centre-south crushed 31.7 million metric tonnes of sugarcane in the second half of June, 25% less than a year earlier, UNICA said in its closely watched biweekly report. Brazil is the world's largest sugar producer and the second-largest ethanol producer, and the centre-south is home to nearly 90% of its cane crop.
Sugar production in the region fell 31% in the second half of June to 1.8 million tonnes, while ethanol fuel output dropped 30% to 1.21 billion litres.
Though June is typically a dry month for centre-south Brazil, heavy rainfall caused mills in key areas to halt operations for an average of 11 days, UNICA said, citing estimates from the Cane Technology Centre, or CTC, in Sao Paulo state. In June 2011, rain only caused problems for five days.
In addition to slowing the sugarcane harvest, rain also dilutes the sugar content of cane stalks. That makes crystallization of sugar more difficult and tends to favor ethanol production by Brazilian mills, which have a degree of flexibility in choosing between the two products.
During the second half of June, centre-south mills devoted 47.8% of their cane crush to sugar production and the rest to ethanol, down from 48.3% in the year-ago period.
But there are signs that fields will yield more cane this year than originally thought, thanks to the continuing rains. Last month, farms harvested an average 76.2 tonnes of cane per hectare, up 1.1% from June 2011, according to the CTC.
"The scenario observed so far indicates that we'll have a higher agricultural productivity than estimated in April, but on the other hand, a drop in the quality of raw material," UNICA interim President Antonio de Padua Rodrigues said in a statement. He added that UNICA will revise its forecast for the 2012/13 sugarcane crush, which currently stands at 509 million tonnes, "if necessary."
Since the harvest began in April, centre-south cane mills have crushed 128.31 million tonnes of sugarcane, down 28% from a year earlier.
Total sugar production is down 29% at 6.69 million tonnes, and ethanol production is off 32% at 4.82 billion litres.