By Fabiola Gomes
SAO PAULO, March 13 Brazilian sugar cane mills
struggling with growing debts have begun the April-March cane
crushing season early as they try to generate cash and take
advantage of attractive domestic ethanol prices, cane industry
association Unica said on Thursday.
Analysts have been paring back their expectations of
Brazil's main center-south sugar cane crop due to dry, hot
weather in recent months that is likely to curb the crop's
Consequently, sugar and ethanol output are likely to fall or
remain flat compared with the 34.3 million tonnes and record
25.5 billion liters (6.7 billion gallons) produced last year,
As a result, Brazil is likely to turn to the international
fuels markets to import more gasoline this year to keep up with
growing domestic demand and expects no significant increase in
ethanol production, Unica's technical director, Antonio de Padua
Rodrigues, told Reuters.
He said that as many as 40 mills will be crushing by the end
of March, typically the final month of the January-March
interharvest period in which mills typically remain idle or
conduct maintenance due to the wet conditions during the peak of
the rains season.
Brazilian cane mills have been struggling under weak sugar
and ethanol prices over the past year, prompting an increasing
numbers of mills to enter bankruptcy protection while they
restructure their debts with creditors. Some of the more than 44
mills that have closed over the past few years will never
"The financial situation is forcing in large part the mills
to start harvesting early," Rodrigues said. "First to generate
cash flow and second to capitalize on the high prices and tight
supply of ethanol on the domestic market."