Brazilian ethanol exports to US plummet by 94%

The volume of anhydrous ethanol exported from Brazil to the US has fallen from 376.2 million litres in Q2 2008 to 22.3 million litres in Q2 2009.

Several factors explain this dramatic reduction. Rains during much of June reduced the number of days available for sugarcane crushing, lowering the volume of cane harvested as well as the sucrose content of the cane. This is despite the entry of 10 mills that began production in the current harvest.

Total production of ethanol fell by 8.2% to 1.424 billion litres. Exports from Brazil fell from 1.1 billion litres to 985 million litres.

Secondly, there has been an increased demand for ethanol in newer markets: the reduction in direct exports to the US has been offset by a large increase in exports to India, Japan and South Korea. Exports to Caribbean countries and to Europe remain at about the same levels as last year.

Prices paid to sugarcane farmers have risen slightly, but the price of Brazilian ethanol remains lower than the cost of production.

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