DECEMBER – MARCH: SUGARCANE OFFSET IN BRAZIL

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The sugarcane off-season in Brazil occurs from December to March and this means that production drops drastically during this period. With the reduction in supply, prices tend to be higher in Brazil.

From December to March, a good part of the sugarcane mills located in the southeastern region of Brazil go into maintenance, collective vacations and pause production. But that doesn’t mean a pause in supply or exports.

Brazil is the world’s largest producer of sugarcane and, in the 2020/21 harvest, was responsible for the production of 654.5 million tons destined for the production of 41.2 million tons of sugar and 29.7 billion tons of sugar. liters of ethanol.

In this article we will explain how it is possible to import sugar from Brazil even in the off-season.

Contents

THE IMPORTANCE OF THE SUGARCANE INTERSAFRA

What is sugarcane off-season?

The off-season represents a very important period for the sugar-energy company. It’s time to prepare the way to soon start a new crop in search of more productivity and results. In the countryside, the focus is on cultural practices so that the cane field can grow even stronger.

At the mills, the time is for staff training, maintenance in the industry and adjustment of plans for the next harvest.

IT IS POSSIBLE TO IMPORT SUGAR IN THE INTER-HARVEST

Yes, it is possible as long as your company is really prepared to quickly fulfill the sales procedures.

SEE THE SALES PROCEDURES HERE: https://mellocommodity.com.br/procedures-and-terms/

If your company’s demand has a monthly recurrence, then you need to rush and close a supply contract by December. Since the exporter will have to reserve the contracted volume for his company. As well as planning shipments.

Your company will not run out of sugar if it fails to close a supply contract by December, but it will certainly pay a higher price, as exporters will have to source sugar in the off-season, when supply is much lower.

In the low season, the supply plants are located further north of the country and this results in higher logistics costs. Obviously they will be passed on to the importer.

MISSING SUGAR IN THE INTER-HARVEST?

Yup. It is possible that some types of sugar are missing, such as: ICUMSA 150, ICUMSA 100, among others.

In this period, the focus of supply is on the most demanded sugars in international trade, such as VHP 600-1200 AND ICUMA 45.

With the reduction in supply, exporters tend to prioritize service to regular customers and push new customers towards the beginning of the harvest.

Brazil produces and exports sugar all year round, however it will prioritize serving markets with regular imports.

HOW TO GUARANTEE THE SUPPLY OF SUGAR DURING THE CANE OFFSHORE?

I will guide you how to get sugar during the off season with MELLO COMMODITY.

1 – Clearly define your order and build a spreadsheet of total costs in the import process

2 – Analyze the sales procedures and check if your company has the logistical and financial structure to make the purchase possible

3 – Forward and approve the lines of credit necessary to make the import viable

Brazilian exporters only accept financial instruments issued or confirmed by the world’s 50 largest banks. See the list: https://risk.lexisnexis.com/insights-resources/article/bank-rankings-top-banks-in-the-world

4 – Request a quote and start trading.

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