The sugar-cane harvest may be about 10 million metric tons higher than first forecast in the main growing area of Brazil, the world’s biggest producer, if dry weather persists, according to UBS AG.
The output estimate for the 2012-13 season under way in the center south region would be revised from 510 million tons, the bank said in a report dated yesterday. Dryness allowed cane processing to advance 14 percent to a record 46.5 million tons in August’s second half, industry group Unica said yesterday. Rains in May and June had delayed the crop.
“The welcome dry weather has enabled sugar crushers in Brazil to accelerate the harvest and make up for lost ground,” said Wayne Gordon, a strategist at UBS in New York. “The total cane cut is still below a year ago, yet if current conditions persist, we could see a final estimate in the vicinity of 10 million tons more than our initial forecast.”
Raw sugar, down 13 percent this year in New York trading, may drop to 18 cents a pound in three months as Brazilian exports gain momentum and concerns ease about a lack of rain in India, the second-biggest sweetener producer and largest consumer, according to the report.
The monsoon, which brings more than 70 percent of the South Asian country’s rainfall, is 9 percent below a 50-year average since June 1, according to the India Meteorological Department.
Raw sugar for March delivery rose 0.1 percent to 20.19 cents a pound by 9:35 a.m. London time on ICE Futures U.S. in New York.
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