Brazil's new sugarcane crop seen 3.8% down; planting rises 4.1%
Adds comments from broker, sugar price move
SAO PAULO, April 25 (Reuters) - Brazil's new sugarcane crop will be only slightly smaller than the record previous one, government agency Conab said on Thursday, and sugar production will reach an all time high as higher planting partly offsets falling agricultural yields.
Conab projected Brazil's 2024/25 (April-March) total sugarcane crop at 685.86 million metric tons, 3.8% less than in 2023/24.
The fall in total cane volume is smaller than the expected decline of 7.6% in agricultural yields due to below-average rains and excessive heat. That is a result of a 4.1% increase in planted area to 8.67 million hectares.
"Conab surprised the market with that area increase. Others such as USDA see a much smaller expansion," said a U.S.-based sugar trader.
The USDA projected last week a larger fall for the Brazilian sugarcane crop at 8.5%, estimating a planted area increase of only 1.3%.
Sugar prices in New York SBc1 fell as much as 3% after Conab's report.
Sugar output in Brazil, the world's largest producer and exporter of the sweetener, was projected by Conab at a record 46.29 million tons in the new season, or 1.3% above the previous cycle, which also was the previous record.
Production of ethanol, both sugar and corn-based, should fall 4% to 34.18 billion liters. Accounting only the sugar-based biofuel, output is seen decreasing by 8% as mills allocate an increasing amount of cane to sugar and less to ethanol.
Production of corn-base ethanol, however, is seen growing by 16%.
Reporting by Peter Frontini and Leticia Fucuchima; Additional reporting by Marcelo Teixeira; Editing by Steven Grattan
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