South America Calling
Brazilian Sugarcane Output to Fall Next Year
Brazil's center-south will see sugarcane crushing decline by 6.8% next season due to low levels of crop replanting, according Plinio Nastari, president of Datagro, a leading local industry consultancy.
The 2014-15 harvest, which starts in March, will total 556 million metric tons (mmt), down from 612 mmt from the current harvest, which finishes in November.
P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]
The decline in replanting across the center-south, which accounts for about 85% of production, is a result of dry weather, which created unfavorable soil conditions.
Low prices for sugar and ethanol were also a disincentive.
As a result, sugar output is seen dropping 3.7% to 32.9 mmt, while ethanol production is pegged to fall 6.7% to 24.0 billion liters.
Ethanol distillers have long complained government controls of gasoline prices inhibit their competitiveness. But even with local gas prices 15% below equivalent international crude levels, ethanol has gained market this year, said the consultant.
Hydrous ethanol consumption has risen 21% in 2014 and the percentage of flex-fuel cars using ethanol has risen to 35%. Indeed, ethanol is currently much more profitable the sugar and crushers will increase output of the biofuel this season, said Nastari.
(AG)
© Copyright 2014 DTN/The Progressive Farmer. All rights reserved.
Comments
To comment, please Log In or Join our Community .