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18 Mar 10 |
Ethanol
Low liquidity presses prices down
Brazilian ethanol prices remained the downward trend in the Sao Paulo
market during the first fortnight of March. Distributors continued with
low interest in purchases due to reduction of sales at the pump.
Besides, consecutive drops observed in the Brazilian ethanol prices and
the nearness of the new crop drove purchasers to refrain, expecting
lower prices. On the other hand, some mills sold product at lower prices
than those negotiated by most part of mills in the market, this was in
order to make cash for payments of early month.
Overall, trades were closed at small volumes. During March 1-5, the
CEPEA/ESALQ Index (Sao Paulo state) for anhydrous averaged 1.1198 real
or 0.6257 dollar per liter (excluding taxes) for a decrease of 6.85
percent in relation to the previous period. The CEPEA/ESALQ Index for
hydrated averaged 0.9350 real or 0.5225 dollar per liter (excluding
taxes) for a drop of 6.15 percent in the same period.
In the subsequent week, during March 8-12, the CEPEA/ESALQ Index (Sao
Paulo state) for anhydrous averaged 1.0026 real or 0.5651 dollar per
liter (excluding taxes) for a decrease of 10.5 percent in relation to
the previous period. The CEPEA/ESALQ Index for hydrated averaged 0.8271
real or 0.4662 dollar per liter (excluding taxes) for a drop of 11.5
percent in the same period.
As for exports, according to Secex (Foreign Trade Secretariat), ethanol
shipments (anhydrous and hydrated) dropped 31.7 percent in February in
relation to January, amounting 104 million liters exported. Comparing
February 2010 and February 2009, shipments were 12 percent lower and
14.2 million liters less were exported. During the 2009/10 crop (April
2009 and February 2010), 3.1 billion liters were exported, according to
Secex. (Cepea – Brazil)
Sugar
Interest in sales reduces
prices
Although sugar supply is still low, Brazilian crystal sugar prices
decreased over the first fortnight of March due to strong drops in the
international market and nearness of the new crop. Moreover, part of
mills decided to finish stocks once they cannot stop the downward trend
expected to the short period. On Monday, March 15, the CEPEA/ESALQ Index
(Sao Paulo state) for crystal sugar closed at 69.48 reais or 39.41
dollars per 50-kilo bag for a drop of 4.46 percent in relation to
February 26. Since early January, the Index had oscillated over 70 reais.
According to
Unica (Sugarcane Industry Association), during April 1, 2009, and
March 1, 2010, around 535 million tons were crushed in the
Central-Southern region, volume 6.4 percent superior to the same period
of the 2008/09 crop (503 million tons). This period represents the total
of the 2009/10 season of Center-Southern region. Sugarcane production
allocated 57 percent for ethanol and 43 percent for sugar.
Sugar production reached 28.5 million tons, 6.9 percent higher in
relation to the previous period (26.7 million tons). Ethanol production
limited to 23.3 billion litters for a drop of 6.7 percent (25 billions
litters) – 17.1 billion litters allocated for hydrated (an increase of
3.7 percent) and 6.2 billion litters allocated for anhydrous (a
reduction of 26.9 percent).
Brazilian exports of raw sugar (VHP) amounted 979.97 thousand tons in
February, 24 percent lower in relation to January (1.29 million), but
4.2 percent higher compared to February 2009 (940.71 thousand tons),
according to Secex (Foreign Trade Secretariat). In the 2009/10 crop
(during April 2009 and February 2010), shipments reached 16.94 million
tons of VHP sugar, 21.3 percent superior to the total exported in this
period the previous season (13.97 million tons). (Cepea – Brazil)
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