Brazil’s Millers May Switch to Ethanol If Prices Keep Converging

Millers in Brazil, the world’s largest sugar producer, may switch to making ethanol at the expense of the sweetener if prices for both commodities continue to approach similar levels, Societe General SA said.

Domestic sugar sales in Brazil were last week 32 percent more profitable than anhydrous ethanol, the type blended into gasoline, according to Cepea, a university of Sao Paulo research group. Local sugar sales were 35 percent more advantageous last week than the hydrous kind, used in flex-fuel cars. That compares with a 40 percent advantage in the week ended March 2 for both types, the data show.