Porto Alegre, May 23th, 2022 – The most recent data presented by the Ministry of Agriculture (MAPA) on the Gross Production Value (GPV) of cane and agriculture as a whole show a divergent behavior between cane and that of crops and agriculture. The gains of cane from March to April (most recent data available) take into account the advances of anhydrous and hydrated ethanol observed so far. At the other end, in the margin, we see relative cuts in the GPV of soybeans, corn and the meat complex because of the super production achieved by these crops. These comparisons are made on the evolution of the margin, in the short term, with data for the current month versus the previous one.
In the year we see that the gains remain strong for soybeans, corn, and the meat complex, which leaves total agribusiness and total crops with gains in the annual comparison, although with downward adjustments in the margin. Cane also has advances of 10% this year. The detail is that cane has advanced in the margins while the other main crops have not. Moreover, SAFRAS & Mercado expects that the May data will bring new advances to the cane GPV. This is because April was supported by highs in the anhydrous and hydrated ethanol markets, while May must be supported by sugar highs in the international market.
It is quite true that the gains in anhydrous and hydrated ethanol that were seen in April have not been observed in May, but the sugar advances must easily compensate for these declines. The MAPA indicates that cane is in the group of commodities rated as one of those with record sales whereas, according to the vision of SAFRAS & Mercado, at least until July this scenario must remain favorable to sugar, mainly via the New York exchange.
It is interesting to note that the total GPV of agriculture at BRL 1.216 trillion shows an annual increase of 4.74% (against BRL 1.61 trillion in 2022) but a decrease of 5.53% in the margin (against BRL 1.229 trillion in March). The GPV of crops at BRL 868 bln is 8.81% higher YoY (against BRL 804 bln in 2022) and 8.44% lower in the margin (against BRL 878 bln in March). Cane, at BRL 107.87 bln, is up 10% YoY (against BRL 98.01 bln in 2022) and up 5.67% in the margin (against BRL 102.08 bln in March).
Follow the Safras Agency on our website. Also follow us on our Instagram and Twitter and stay on top of the main agribusiness news!
Copyright 2023 – CMA Group