A total of 38.51 million mt of sugarcane was crushed in Central-South Brazil in the first half of September, down 10.9% from 43.31 million mt crushed during the second half of August, and down 15.3% from 45.47 million mt crushed during the year-ago period, trade association UNICA data showed Tuesday.
The volume crushed was about 1.05 million mt below the market expectations, according to an S&P Global Platts survey of analysts released Monday.
The cumulative cane crushed so far this season is now up to 430.35 million mt, up 0.47% from 428.32 million mt in the year-ago period, according to UNICA.
Data from the Sugarcane Technology Center showed a 9.2% decrease in sugarcane yields, reaching 70.73 mt/hectare in H1 2018, versus 77.87 mt/hectare during the same period of 2017.
The 2018-2019 sugarcane season began April 1 in the key Center-South region, the largest sugarcane and sugar producer in the world. But chronic dryness is widely expected to bring an early end to crushing, with the season seen closing a month to a month and a half earlier than usual. A preliminary survey given by UNICA indicated that 75% of milling units expect to end crushing an average of 27 days earlier compared to the previous crop season.
Total Recoverable Sugar (ATR) levels averaged 156.97 kg/mt of cane in H1 September, up 2.8% from 152.66 kg/mt of cane recorded in H2 August, and up 4% from 150.92 kg/mt recorded in the year-ago period. The H1 September level beat market expectations of 155.46 kg/mt, the data showed.
The dry weather in the Center-South has bolstered the average ATR level since April 1 to 139.89 kg/mt. That represents an increase of 4.44% over the same period in crop year 2017-2018, according to UNICA.
Sugar production in CS Brazil in H1 September totaled 2.147 million mt, missing analyst estimates by 53,000 mt. The total was down 9.4% from 2.37 million mt recorded during H2 August, and down 31.57% from 3.137 million mt produced in the year-ago period, UNICA said.
Cumulative sugar production between April 1 and September 16 was 20.99 million mt, down 20.72% from crop year 2017-2018, when 26.48 million mt was produced. The total missed the Platts survey estimate by 50,000 mt.
Brazilian mills have shifted production toward hydrous ethanol due to its greater profitability and strong sales. Hydrous ethanol output in H1 September reached 1.56 billion liters, down 7.1% from the H2 August total of 1.68 billion liters, and 27.3% higher than the year-ago period. The increase beat analyst expectations of 1.52 billion liters, according to UNICA.
Cumulative hydrous ethanol output has risen 57.86% year on year, hitting 15.71 billion liters so far in crop year 2018-2019, compared to 9.95 billion liters in the same 2017-2018 period.
Anhydrous ethanol production in H1 September reached 697 million liters, down 10.2% from H2 August output of 776 million liters, and down 21.44% from the year-ago period. Cumulative anhydrous production was up to 7.047 billion liters, down 6.2% year on year.
Mill production of ethanol rose 0.35 percentage points from H2 August levels to hit 62.73% in H1 September, while sugar production fell to the same amount to hit 37.27% over the same period.
The cumulative share of sugar production and ethanol production by mills is now 36.6% sugar and 63.4% ethanol, with the share of ethanol production increasing 11.84 percentage points from the previous harvest, when 48.44% of cane went to sugar production and 51.56% to ethanol production.
Total ethanol sales amounted to 1.31 billion liters, a decrease of 10.9% compared to 1.47 billion liters recorded in H2 August. The fall in ethanol sales came as working days were lost due to adverse weather conditions, UNICA said.
Hydrous ethanol sales remained high in H1 September, reaching 962.32 million liters during the period, representing a 42.69% increase versus the year-ago period. Anhydrous ethanol sales totaled 353.68 million liters during the period.
On a cumulative basis, total ethanol sales from April 1 to September 15 totaled 13.58 billion liters, with 12.8 billion liters sold domestically and 775 million liters exported to foreign markets, the data said. The total represents growth of 18.1% compared to the same period of the 2017-2018 harvest, UNICA said.