More Commodities - Sugar

Sugar: production forecasts for Brazil increased

July 16, 2020 at 2:21 PM , Der AUDITOR
Play report as audio

BRASÍLIA. Brazil, the most important export country for sugar, will increase its production by almost 20% this season. The coronavirus pandemic is playing a decisive role in this.

Fuel production reduced

As the Brazilian forecasting authority Conab announced in its official estimates for the 2020/2021 season, sugar production is expected to increase by about 18.5% to 31.85 million metric tonnes. The main cultivation area, Center-South, where about 90% of Brazil's sugar cane is grown, will also increase its production by 18.5% to 31.85 million metric tonnes. Although the acreage for sugar cane is about 2% smaller than last year, more sugar cane is used for actual sugar production. Until now, a large part of the crop, namely about 65%, has been used for ethanol production. This year, the amount of sugar cane available for sugar production is expected to be about 8% higher. This is largely due to the coronavirus pandemic, which has drastically reduced the demand for oil and fuel and brought prices down significantly.

Price up and down

In February, sugar prices on the world market were marking a ten-year low. In the meantime, the situation has eased again, with price increases of up to 30% at times in June. However, market players reckon that prices will now remain at a stable level for the time being, as consumption is still restricted by the pandemic, which is particularly evident in the baking industry. Higher production in Brazil, the most important export country, should also prevent significant price increases. The prices for granulated sugar, EC Cat. II, medium are currently around EUR 0.44 per kg DDP Germany on the European spot market. Raw sugar is quoted on CBOT at around USD 0.26 per kg.

View related articles

Go to the News Overview
Jul 5, 2023
BRASÍLIA/BRUSSELS. Grounds are slippery in Brazil’s sugar market as local traders do not only need to keep a close eye on quotations in New York and London but are also confronted with manipulation and fraud. The EU may not be Brazil’s top export destination, but raw cane sugar imports have soared despite prices being high.
Sep 23, 2021
BRUSSELS/FRANKFURT. EU sugar exports are expected to outstrip imports in the current marketing year. Although the market has certainly rebounded from the impact of the pandemic, sugar manufactures are trying to adopt a cautious approach to the post-pandemic future in 2021/2022. Market prices are also reflecting this development.
Jul 8, 2021
MANNHEIM. While Südzucker AG's group revenues increased slightly in the first quarter of the current 2021/22 financial year, group operating profit declined for the time being. For the first time, the quarterly report covers five segments instead of the previous four.
Feb 17, 2021
BRUSSELS/FRANKFURT. Market players are sounding the alarm bells over declines in production, particularly in France and in Germany. Concerns are being voiced that Germany's sugar suppliers will not be able meet food industry demand at the end of August. EU-UK trade has also been adversely impacted by Brexit.