Sugar exports from Brazil, the world’s largest producer, regained an advantage over sales in the domestic market last week as local prices continued to slide, according to a University of Sao Paulo research group.
Exports were 2.8 percent more profitable than local sales in the week ended Aug. 31, reversing an advantage of 0.44 percent for domestic sales the previous week, the group, known as Cepea, said in a report yesterday. The price of crystal sugar, which accounts for 68 percent of all the sweetener sold within Brazil, fell 0.6 percent in the period to 53.34 reais ($26.27) per bag of 50 kilograms (110 pounds), Cepea said. Raw sugar traded in New York climbed 1 percent to 19.78 cents a pound in the week.
“The dry weather between July and August favored advances in the crushing activities of the sugar cane in Sao Paulo state and, consequently, the stepping up of sugar production,” Heloisa Lee Burnquist, a Cepea analyst, said in the report.
Sugar-cane processing in Brazil’s center south, the main growing region, jumped 14 percent to 44.2 million metric tons in the first half of August, helped by dry weather, according to industry group Unica. Harvesting will accelerate with dry weather forecast for the next three weeks, said Celso Oliveira, a weather forecaster at Sao Paulo-based Somar Meteorologia.
Sugar sales in the domestic market were 30 percent more profitable than anhydrous ethanol, the kind used to blend into gasoline, and 42 percent more advantageous than hydrous ethanol, used in flex-fuel cars, Cepea said. Both the sweetener and the biofuel are made from raw material sugar cane.
Crystal sugar has an International Commission for Uniform Methods of Sugar Analysis level of between 130 and 180, according to the Cepea website. A lower level corresponds to a higher degree of whiteness. The refined variety traded on NYSE Liffe calls for an ICUMSA level of 45.
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