The amount of sugarcane crushed in the key Center-South region of Brazil in the second half of May is expected to come in at 32.15 million mt, down 21% from a year ago, an S&P Global Platts survey of analysts showed Monday.
Industry association UNICA is expected to released its bi-monthly sugarcane harvest data Thursday.
Analysts put sugarcane crushed in May between 27 million mt and 34.9 million mt.
The drop can be attributed to almost five days of crushing lost to rain in H2 May.
Taking the average of analysts' estimates of the volume crushed in H2 May, cane crushed since the season began on April 1 will total 140.7 million mt, up 29% year on year.
Analysts at Kingsman, an agricultural analytics unit of S&P Global Platts, are forecasting a cane crush of 33.9 million mt and 4.5 days lost to rain.
Kingsman senior analyst Claudiu Covrig said the wet period definitely contributed to the increase in agricultural yield for the second half of the current crushing period and probably helped hike yields for H1 2017 too.
Analysts surveyed by Platts estimated the percentage of cane that went into sugar production at 43.07% in H2 May, down 44% from a fortnight earlier, but up from 41.15% in H2 May 2015. The balance, or 57%, was directed towards ethanol output.
The ATR was 126.61 kg/mt of cane, the survey showed. This compares with 124.34 kg previous fortnight and the same period a year ago. The wider range of analysts spanned from 123 kg to 130 kg.
Analysts at Kingsman pointed out that one of the factors that increased the percentage of cane that went into ethanol production -- besides the usual need of cash for pay-roll commitments at the end of the month -- was that in some regions towards the end of May, the cane had many impurities due to the rain, making it more suitable for ethanol than sugar production.
Ethanol sells fast in the domestic market due to high demand.
Sugar output is expected to total 1.668 million mt in H2 May, down 16% year on year. However, if realized total sugar production in the first two months of 2016-2017 season (April-May) reaches 6.97 million mt, it would be of 50% higher from a year earlier.
According to the survey, total ethanol production in H2 May is expected to come in at 1.34 billion liters, down 23% year on year, with the hydrous grade accounting for 62% of the total at roughly 831 million liters, down 27%, or 312 million liters, from same period in the previous season. Anhydrous ethanol production is expected to drop 15% year on year to nearly 514 million liters.
Hydrous ethanol is used as a standalone biofuel in flex-fuel vehicles, while anhydrous ethanol is blended with gasoline in a proportion of 27%.
