Sugar production in the first half of September in Brazil's key Center-South region is expected to total 3.271 million mt, a surge of 61% year on year, according to consensus expectations of analysts surveyed by S&P Global Platts Sept. 22.
If analyst estimates prove to be right, this would be the second highest volume of sugar produced in any H1 September, just behind the 3.407 million mt produced in the same period of 2017.
Considering the expected amount to be produced during the first two weeks of September, the cumulative production since April 1, might reach 29.17 million mt, an increase of 45.46% on the year.
The amount of sugarcane crushed in the first half of September is expected to total 44.86 million mt, 13.3% more than the prior year period, according to the survey.
If this forecast proves to be right, the cumulative cane crush of the 2020-21 crop will be up to 459.95 million mt.
Considering the total cane crush estimated by Platts Analytics at 600 million mt, this cumulative number would represent 76.66% of the crop already harvested. The fast crushing pace can potentially be translated in an earlier end of crop, but not necessarily a suddenly death, when producers fail to crush the whole volume of cane in lands.
Market participants are estimating that crushing season in CS can end by late October in many producing regions.
Of the 11 analysts surveyed, the cane crushed ranged from 43.4 million mt to 47.6 million mt.
Industry association UNICA is expected to release its official production figures in the coming days.
The analysts surveyed by Platts expect an average of less than half day of crushing stoppages in the analyzed period, which was mostly attributed to dry weather.
Cane's total recoverable sugar (ATR) is expected to rise to 158 kg/mt from 154.2 kg/mt in H1 September 2019, the highest for the period since the same period of 2010 when the ATR was recorded at 160.55 kg/mt
The proportion of cane used for sugar production in CS Brazil in H1 September is expected at 46.81% from 35.02% a year earlier, according to the survey. The larger share of cane being converted for sugar production is due to higher export sugar prices compared to domestic ethanol.
Platts Analytics estimates that 47.2% of the total cane crush will be diverted to the sweetener production, slightly higher than the average consensus.
Platts assessed hydrous ethanol converted in raw sugar equivalent on Sept. 21 at 10.43 cents/lb, while the ICE NY11 sugar futures market settled at 12.55 cents/lb, pointing to an export premium of 2.12 cents/lb or $46.74/mt over the hydrous ethanol domestic market.
As the ethanol mix is expected to fall dramatically to 53.19% from 64.98% in the year-ago period, the total volume of cane ethanol produced is expected to fall 4.4% on the year to 2.23 billion liters.
Production of hydrous ethanol -- used as a standalone E100 biofuel in Brazil -- is expected to fall 9.1% year on year to 1.52 billion liters in H1 September, while anhydrous ethanol output during the period is expected to reach 717 million liters, an increase of 7.4% year on year. Anhydrous is used at a mandatory blending rate of 27% in Brazilian gasoline.
