Strong demand for Brazilian sugar
JACIMARA DA SILVA
I trade stocks of Sugar, Soy and Corn produced in Brazil. We have been supplying food to the international market since 2004
The strong demand for Brazilian sugar in 2020 may be reflected in a significant increase for the product in 2021.
Firm demand for 2021
Bunge sees firm demand for sugar from Brazil in 2021.
According to BP Bunge Bioenergia, sugar importers will “knock on Brazil's door” next year, which should boost the plants' production. The pandemic had an impact on global demand, but with less supply from major producing countries, such as Thailand and Australia, supplies will remain below consumption. The fall in production coincides with the increase in imports in countries like China.
Brazil dominates the global offer
Brazil, which accounts for half of the global sugar trade, has exported record volumes this year, as the rise in the dollar against the real makes overseas sales more competitive.
But, starting in December, the mills will depend on inventories to meet demand, as production for the next harvest will not be available in significant quantities until the end of the second quarter, said Ricardo Carvalho, commercial director at BP Bunge Bioenergia.
Mills will have to try to produce sugar at the beginning of the harvest beginning in April, Carvalho said. Typically, producers maximize ethanol production at the beginning of the season due to the poor quality of the cane.
The market will knock on Brazil's door asking for sugar
"The market is going to knock on Brazil's door asking for sugar," Carvalho said in an interview. "The recovery in global production will not happen in 2021."
In a sign of tight supply in the short term, sugar contracts in New York with closer maturities are being traded at a premium over longer delivery futures. Last week, prices rose to the highest level since February amidst the unstable climate in Brazil.
Futures fell this week in the face of speculation about new export subsidies from India, which could lead to an oversupply of global supply.
"Our scenario considers that the export subsidy program in India is still unknown," said Carvalho. "We see, however, this strong demand for sugar from Brazil arriving even in the midst of a new subsidy from India."
Source: https://revistarpanews.com.br/bunge-ve-demanda-firme-por-acucar-do-brasil-em-2021/
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