São Martinho reduces cane crush growth estimates

One of Brazil’s top five sugar companies, São Martinho SA, fears the recent spate of dryness seen in the last two months over the country’s main sugarcane-producing region may turn detrimental to any last chances of production increase in the new season. The company reduced its cane crush growth to 5% from an earlier projection of 10% in December, equaling 22.5m tons. The company will only decide on the sugar-ethanol production mix in April when the next crop season starts.

São Martinho declared a net profit of US$61.44m in the nine months of the 2018/19 crop year, down 32% year-on-year. A smaller cane crush, lower sugar volumes and a fall in prices contributed to the slower performance of the company.

On a good note, broker and analyst INTL FCStone forecasts that Brazil’s sugar production in the Center-South region will reach 30.2m tons in the 2019/20 season, up 14% year-on-year.

Unica data displays Brazil’s sugar and ethanol production behavior for the last five seasons: 

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