The global sugar shortage, which has caused prices to shoot up to a 12-year high, is expected to ease soon. The reason for this is an increase in corn output for ethanol, a fuel that powers cars in the country. Sugarcane mills are shifting their focus towards producing more sugar and less biofuel. Corn ethanol is gaining a larger share of the ethanol market in Brazil, and it is expected to account for almost one-fifth of all biofuel production this season, compared to almost zero just five years ago. Sugarcane mills have already announced plans to add around 2.5 million tons of capacity to produce sugar in the coming harvests.
Sources: Bloomberg/Nova Cana (*Translated by Ia Niani)