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NEW YORK, March 27 (Reuters) – Hedging operations for the 2023/24 season by Brazilian sugar producers using futures contracts at the Intercontinental Exchange (ICE) reached 20.2 million tonnes by the end of February, according to a projection by Archer Consulting.
The amount is equivalent to around 85% of the expected sugar exports in the 2023/24 season, Archer said in a report on Monday, one of the highest amounts since the consultancy started monitoring Brazil’s sugar hedging in 2012, as mills take advantage of high prices to lock in profits.
Sugar futures on ICE SBc1 hit the highest in more than six years at the end of February as production in regions such as Europe and India is seen smaller than expected, despite a promising crop in Brazil.SOF/L
Archer said hedging by Brazilian mills in February alone reached 2.22 million tonnes. The report estimated an average price of 17.75 cents per pound for the total volume already hedged.
Brazil’s new sugar season starts officially in April, but dozen of mills have already started processing to deal with a potentially large sugarcane crop near 600 million tonnes.
(Reporting by Marcelo Teixeira; Editing by Leslie Adler)
((marcelo.teixeira@tr.com; +1 332 220 8062; Reuters Messaging: marcelo.teixeira.thomsonreuters.com@reuters.net – https://twitter.com/tx_marcelo))
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