(Photo: Reuters/Marcelo Texeira)
The grinding of sugar cane of Central-South Brazil in 2025/26 (April/March) was estimated this Friday at 593.2 million tons, a drop of 3.2% compared to the current cycle, amid a dry climate in 2024, impact from fires in the area to be harvested next year and also due to lower productivity in an older sugarcane field, pointed out the consultancy StoneX.
It would be the second consecutive drop in the harvest in the world's main sugarcane producing region, as the 2024/25 season is expected to record a decline of 6.4% compared to the record visa in 2023/24 (654.4 million tons ).
“The initial perspectives for 2025/26 are still uncertain, and rain is extremely necessary from October onwards, as the Center-South has been in a severe water deficit since November 2023”, stated StoneX, in a report, citing the weather that impacted the current harvest.
StoneX also stated that the sugarcane harvest in the Center-South, which accounts for around 90% of production in the largest sugar producer and exporter in the world, is expected to decline due to a 1.2% smaller harvested area, to 7.61 million hectares.
“The main factor for 2025/26 will continue to be fires, whose estimated impacts on the sugarcane area vary greatly across the sector,” stated StoneX.
The consultancy also mentioned that the region tends to live with an “older sugarcane field, which in itself can harm the TCH (ton of sugarcane per hectare)”.
With sugar demonstrating greater profitability than ethanol, the center-south is expected to direct 51% of sugarcane to sugar production in 25/26, compared to 48.4% in the previous cycle, according to the report.
Sugar production will therefore increase by 2.5%, to 40.6 million tons, said StoneX, citing that in 2024/25 there will be a drop of 6.7% compared to the previous cycle's record.
“The tendency to maximize the sugar mix continues to be more profitable for mills.”
Raw sugar futures traded on the ICE exchange are trading at a seven-month high amid concerns about the harvest in Brazil, which dominates around 70% of global exports.
Sugarcane ethanol production in the center-south in 25/26 was estimated at 24 billion liters, a drop of 7.6%, due to the lower availability of the raw material.
The manufacture of corn ethanol in the Center-South in 25/26, in turn, was forecast at 9 billion liters, an increase of 12.5%, with the expansion of industrial capacity. This production volume indicates the use of 20.9 million tons of cereal.
The share of corn ethanol in the total biofuel market will rise in 2025/26 to 27.3%, compared to 23.5% in the current season.