Cepea, January 6, 2025 – The white crystal sugar market showed resilience in 2024 while facing challenges in both international and domestic scenarios. The lower supply, along with the competition between different destinations of the sugarcane, has highlighted mills’ strategies to increase profits in a scenario of uncertainties.
The 2024/25 has started in April, with higher prices compared to those verified in the same period last year. The increase is related to the low availability of white sugar in the domestic market, since many mills preferred to produce VHP sugar (which is exported) and ethanol.
However, price rises were interrupted by the increase of the volume produced in the first months of the season, by higher inventories and the lower demand. As a result, quotations dropped to the level of BRL 130 per 50-kg bag.
Values rose from August on, hitting records of Cepea series (since 2003) in November, when the monthly average of the CEPEA/ESALQ Index (Icumsa from 130 to 180) was at BRL 166.46/bag, upping 8.93% against October.
This price recovery, in turn, indicated the resilience of players from the sugar sector while facing adversities at the field. Producers faced a sharp decrease of the availability of cane, caused by the combination of dry weather, wildfires and a new disease called murcha. Many agents say that this has been one of the most challenging scenarios ever registered by the sector.
Unica indicates that the sugar production totaled 25.62 million tons from April to November in São Paulo state, 6.55% lower than in the same period of the 2023/24 crop (27.416 million tons).
Abroad, sugar prices remained at high levels, as a result of weather issues in major producing countries, such as India, Thailand and Brazil, which limited the global supply.
(Cepea-Brazil)
Centro de Estudos Avançados em Economia Aplicada – CEPEA-Esalq/USP
