Sugarcane GVP advances by BRL 2.96 bln in May

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   Porto Alegre, June 21, 2021 – The latest update on Brazil’s agricultural Gross Volume of Production (GVP) for sugarcane estimated for 2021, with figures for the month of May, show a value of BRL 82.10 bln, already 1.68% higher than the BRL 80.75 bln reached in 2020. This level of increase is above the level of advantage that was observed in the previous month when projections indicated an annual gain in the GVP of sugarcane of 1.34% in 2021 compared to 2020. This reduction in the level of annual advantage occurred even in the face of the advance in the GVP of sugarcane in 2021, which rose from BRL 79 to 80 bln.

    In line with the increases in the levels of advantage in the annual comparison, in the margin, the scenario is also positive and even more intense. Between April and May, the GVP of sugarcane increased by 3.75% or BRL 2.96 bln. In the previous month, the advance observed up to then was BRL 835 mln in the margin. It is interesting to note that, in parallel, the total GVP of grain crops also continued with a high of 3.26% or BRL 24.15 bln. Likewise, the total GVP of agribusiness, also including the meat industry, advanced by 3.25% in the margin or BRL 35.00 bln.

    These advances are linked to gains in the prices of agricultural products paid to producers, which have had their support levels due to the drought hitting the Center-South and Midwest of the country. According to the Ministry of Agriculture (MAPA), the rise in prices has offset the decline in the volume of supply that occurs due to the drought. Sugarcane is only nominally mentioned by the MAPA as one of the cultures that had the highest level of growth in the period. In fact, the prices of sugarcane derivatives such as anhydrous and hydrated ethanol and crystal sugar have maintained very significant monthly average appreciation levels. Hydrated ethanol had average gains of 90% last month, while anhydrous ethanol advanced 108%, both deflated. Crystal sugar with up to Icumsa 150 had average gains of 45% in May, also deflated and in the annual comparison.

    For 2021, the total projected GVP for agribusiness is BRL 1.111 trillion, an increase of 11.79% over the previous year’s GVP, which was BRL 993.93 bln. In turn, the total GVP of grain crops is projected at BRL 765.35 bln, indicating an increase of 15.81% YoY. The GVP of soybeans is forecast at BRL 366.84 bln, indicating an increase of 31.91% YoY (BRL 278.10 bln in 2020). Currently, that represents 47.93% of the total GVP of grain crops. The sugarcane’s GVP for 2021, currently at BRL 82.10 bln, accounts for 10.73% of the total agribusiness GVP. Corn, with a GVP of BRL 136.54 bln, must grow by 20.30% YoY, accounting for 17.84% of the GVP of grain crops. Coffee, with a GVP of BRL 32.91 bln, must represent 4.30% of the total GVP of grain crops, with a 17.75% decline YoY.

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