Sao Martinho, a major Brazilian sugar producer, will boost its sugar production capacity at the expense of ethanol, just months after it downplayed the possibility of such a shift.
The board has approved plants to increase its sugar production capacity, as well as its total cane crushing capacity, for the next crop.
Sao Martinho's Santa Cruz mill in Sao Paulo state will boost its sugar production capacity to 434,000 tonnes for the 2016-17 season, up from 353,000 tonnes.
Ethanol capacity will be trimmed to 185m litres, from 200m litres.
The facilities total cane crushing capacity will rise by some 400,000 tonnes, to 5.6m tonnes.
About face
In August the company downplayed the chances of just such a shift across the industry.
In a quarterly report, Sao Martinho said that Brazilian producers were "unlikely to add significant new production volume in the coming years".
"The cost and scarcity of capital for projects, combined with the long maturation cycle of a greenfield project, will continue to postpone any investment decisions," Sao Martinho said.
Producers cash in
With raw sugar futures in New York trading near four-year highs, producers are moving to cash in on higher prices.
Last month the Brazilian sugar and ethanol producer Biosev said it planned to increase output capacity by 88,000 tonnes last year.
And last week the US equipment maker AGCO said that producers were investing in harvesting equipment in order to increase cane cutting.
AGCO's Ribeirão Preto plant, based in Brazil's Centre South cane belt, has reported doubled harvester production this year.
John Deere is reportedly looking to boost production of cane harvesters in its Brazilian plant by 30%.
Fount: http://www.agrimoney.com/news/sao-martinho-changes-mind-on-sugar--9975.html?
The board has approved plants to increase its sugar production capacity, as well as its total cane crushing capacity, for the next crop.
Sao Martinho's Santa Cruz mill in Sao Paulo state will boost its sugar production capacity to 434,000 tonnes for the 2016-17 season, up from 353,000 tonnes.
Ethanol capacity will be trimmed to 185m litres, from 200m litres.
The facilities total cane crushing capacity will rise by some 400,000 tonnes, to 5.6m tonnes.
About face
In August the company downplayed the chances of just such a shift across the industry.
In a quarterly report, Sao Martinho said that Brazilian producers were "unlikely to add significant new production volume in the coming years".
"The cost and scarcity of capital for projects, combined with the long maturation cycle of a greenfield project, will continue to postpone any investment decisions," Sao Martinho said.
Producers cash in
With raw sugar futures in New York trading near four-year highs, producers are moving to cash in on higher prices.
Last month the Brazilian sugar and ethanol producer Biosev said it planned to increase output capacity by 88,000 tonnes last year.
And last week the US equipment maker AGCO said that producers were investing in harvesting equipment in order to increase cane cutting.
AGCO's Ribeirão Preto plant, based in Brazil's Centre South cane belt, has reported doubled harvester production this year.
John Deere is reportedly looking to boost production of cane harvesters in its Brazilian plant by 30%.
Fount: http://www.agrimoney.com/news/sao-martinho-changes-mind-on-sugar--9975.html?
