Bloomberg News

Global Sugar Surplus Plummets as Brazil Demand for Ethanol Rises

June 19, 2013

The global sugar surplus for the 2013-14 season may drop to a four-year low amid rising demand for ethanol in Brazil, research firm Datagro Ltd. said.

Sugar output will exceed demand by 430,000 metric tons in the season starting Oct. 1, compared with a previous estimate for a surplus of 6.18 million tons, Plinio Nastari, president of Datagro, told reporters today in Sao Paulo.

“Sugar prices simply don’t pay the bills of mills, and ethanol is on the verge of becoming extremely attractive to consumers,” Nastari said.

Ethanol is appealing to drivers in Brazil when the price of the biofuel is of as much as 65 percent that of gasoline, Nastari said.

Gas stations in Sao Paulo state, which accounts for 36 percent of the country’s passenger-car fleet, are offering ethanol for 62 percent of the price of the oil-based fuel, he said.

To contact the reporter on this story: Lucia Kassai in Sao Paulo at lkassai@bloomberg.net

To contact the editor responsible for this story: James Attwood at jattwood3@bloomberg.net


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