Why sugar prices remained firm in Brazil even with low liquidity at the moment?

Published Mar 21, 2023

Tridge summary

Despite low liquidity, white crystal sugar prices in Brazil have remained around R$130 per 50 kg bag. The supply of higher quality sugar is low, but demand for prompt delivery is also weak. The Cepea/Esalq indicator for sugar reached a peak of R$ 133.34 per bag on March 10th. The appreciation of sugar abroad and the difference between supply and estimated demand for the 2023/24 season are factors contributing to the firm prices. Additionally, the return of taxes on gasoline in Brazil is expected to increase the volume of sugarcane for ethanol production, potentially reducing the world sugar supply.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

White crystal sugar prices have remained firm in Brazil in recent weeks, hovering around R$130 per 50 kg bag, even with a scenario of low liquidity in negotiations at this time of off-season in the Center-South of Brazil, according to the Center for Advanced Studies in Applied Economics (Cepea, from Esalq/USP). "The supply of higher quality sugar (Icumsa up to 180) remains low in Brazil, but the demand for prompt delivery is also weak. Buyers have stocked up to get through the off-season – or are receiving the product previously purchased", highlights the center of research on the current market scenario. The Cepea/Esalq indicator for this type of sweetener reached a peak of R$ 133.34 per bag on March 10th. This is also the highest level since February 28 (R$ 133.49 a bag). The question that remains is: why have sugar prices remained firm in Brazil even with a scenario of low liquidity in negotiations? "In the first half of March, domestic quotations may have been supported by the ...

Source: NoticiasAgricolas