The global sugar market is facing mounting pressure as Brazil’s Center-South region grapples with worsening fire outbreaks and dry conditions. Fire impacts and high temperatures are increasing concerns about the region’s crystallization capacity. Mills in the area are struggling to balance rapid cane crushing with the need to maximize sugar output, as the current pace limits their flexibility.

Last week, UNICA released the second half of August, The cane crush in the Center-South region was reported at 45.067 MMT, representing a decline of 3.25% compared to last year. The Total Recoverable Sugar (TRS) rate stood at 155.34 kg/tonne, showing a 0.92% increase year-on-year. The sugar mix was 48.85%, reflecting a decrease of 1.90 percentage points YoY. This resulted in sugar production of 3.258 MMT, down 6.02% YoY, and ethanol production of 2.452 Mcbm, up 6.25% YoY, see Figure below.


The production data for the second half of August however, doesn’t fully reflect the impact of the wildfires in the Center-South region, especially in São Paulo, where the fires intensified after August 22. A partial survey by UNICA, covering companies responsible for about 75% of São Paulo’s production, indicated that at least 231,830 hectares of sugarcane were affected by the fires in the second half of August. Of this, 132,040 hectares were yet to be harvested, while 99,790 hectares had already been harvested or were in early planting stages – This situation is expected to further complicate sugar production and worsen the decline in crop yield.

As a result, market estimations have lowered its 24/25 crush forecast to around 593 MMT, down from 600 MMT. This has pushed sugar output estimates down to 39.3 MMT, a notable decline from previous projections.

According to Vesper, the most recent prices are recorded as follows:

  • The Crystal Sugar (BR, Partner Price, FOB Brazil) (17/09/2024) increased to 564 USD/mt;
  • The Refined Sugar (BR, Partner Price, FOB Brazil) (17/09/2024) increased to 549 USD/MT;
  • The Raw Sugar (BR, Partner Price, FOB Santos) (17/09/2024) increased to 447 USD/MT;

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