Commodities

Brazil's sugar output revised down as dry weather persists -report

Credit: REUTERS/PAULO WHITAKER

Brazil's 2021/22 centre-south (CS) sugar production was revised to 34.1 million tonnes from an April projection of 35.6 million tonnes, as persistent dry weather hurt cane development, food trader and supply chain services provider Czarnikow said on Tuesday.

Adds details of estimates, comments from analyst

NEW YORK, June 29 (Reuters) - Brazil's 2021/22 centre-south (CS) sugar production was revised to 34.1 million tonnes from an April projection of 35.6 million tonnes, as persistent dry weather hurt cane development, food trader and supply chain services provider Czarnikow said on Tuesday.

According to the report, Brazilian millers will be able to crush only 535 million tonnes of sugar cane this season, the smallest amount since 2012. Czarnikow's previous estimate was for a crush of 558 million tonnes. Brazil's CS processed 605 million tonnes in 2020/21.

Cane-based ethanol production is seen falling 12% from the previous season to 24.4 billion liters.

Czarnikow said Brazil's CS rains between January and June are 43% below normal, which reduced agricultural yields on cane fields by 12% so far to 69.8 tonnes per hectare.

"We must admit that the break was larger than we expected," said analyst Ana Zancaner in the report.

Czarnikow said the smaller production will lead Brazil to export less raw sugar.

"The biggest impact is expected in Q1’22, as the reduction in the crop estimate leads mills to cancel their commitments towards the end of the cycle."

(Reporting by Marcelo Teixeira Editing by Marguerita Choy)

((marcelo.teixeira@tr.com; +1 332 220 8062; Reuters Messaging: marcelo.teixeira.thomsonreuters.com@reuters.net - https://twitter.com/tx_marcelo))

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