Brazilian sugar factories are expected to produce only 200,000 tonnes more sugar in the 2022/23 season (April-March) despite a better sugarcane crop, as a larger part of the cane will be used to make ethanol.
The bank’s agricultural research arm projected Brazil’s centre-south (CS) sugar production at 32.2 million tonnes in 2022/23 versus 32 million tonnes in the previous season. The sugarcane crop was seen at 555 million tonnes, up from 523 million tonnes in the last season which was hurt by drought and frosts.
Itau BBA believes mills will cut the amount of sugarcane used for sugar production, with the respective increase of cane allocation to ethanol making.
It sees Brazil’s CS ethanol output (including corn ethanol) reaching 30 billion liters in the new season, 9% more year-on-year.
Mills are seen allocating 43.5% of cane to sugar from 45.2% last season.
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