Brazil's centre-south (CS) region should crush a larger amount of sugarcane and produce more sugar than initially expected due to more favorable weather conditions and a larger focus by mills on production of the sweetener, a report said on Thursday.
It is reported by Nasdaq.
According to revised projections published by consultancy Job Economia, Brazil's main sugar belt will crush 566 million tonnes of sugarcane in 2022/23, versus 558 million tonnes expected back in April.
Sugar production is seen rising to 34.8 million tonnes from 33.5 million tonnes seen previously.
Rains over cane fields in Brazil recently have improved prospects for cane volumes going towards the final half of the crop, the report said.
Julio Maria Borges, a partner and director at Job Economia, said the higher projection for sugar production is also a result of increased allocation of cane by mills to make the sweetener.
He expects mills to allocate 46.1% of cane to sugar, compared to a projection of 44.1% in April. Borges said falling fuel prices in Brazil mean that mills make more money by producing sugar, not ethanol.
Job Economia now expects Brazil's CS 2022/23 ethanol output to come in at 29.1 billion liters, versus 30.2 billion liters seen in April. Its projection for 2022/23 CS sugar exports went up to 25.6 million tonnes from 24.5 million tonnes previously.