Sep 30, 2021

Brazil's 2021/22 Sugarcane Crop Encountered Numerous Problems

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The sugarcane producers in Brazil are not having a very good year. Everything that could go wrong did go wrong with the 2021/22 sugarcane crop. The first thing to go wrong as a historic drought in south-central Brazil which was then followed by a series of very cold temperatures in July and August resulting in numerous frosts and freezes. The freezing temperatures were followed by very hot and dry conditions resulted in numerous sugarcane fields catching on fire.

As of September 1st, there were 254 sugar mills operating in Brazil compared to 261 operating a year earlier. Five sugar mills had already ended harvesting operations on September 1st due to a lack of sugarcane, which is approximately two months earlier than usual.

From the start of the harvest season on April 1st until September 16th, Brazil's sugar mills had harvested 430.9 million tons of sugarcane compared to 461.4 million a year earlier, or a decline of 6.6%. Sugarcane harvesting during the first half of September registered even greater declines. The Union of Sugarcane Industries (Unica) reported a decline of 14.5% in sugarcane harvesting during the first half of September in the state of Sao Paulo and a decline of 13.4% for other sugarcane producing states in south-central Brazil.

Sugar production thus far this harvest season has declined 8% from 29.1 million tons last year at this time to 26.3 million. Ethanol production thus far has totaled 20.7 billion liters with 1.48 billion liters coming from corn.

Since the start of the sugarcane harvest, approximately 7.1% of Brazil's ethanol production has been from corn. Corn-based ethanol facilities will continue to operate after the sugarcane harvest wraps in in November, therefore the percentage of Brazil's ethanol produced from corn will end up being greater than the current 7.1%.