Brazil’s sugar/ethanol sector may have sweeter prospects than the market thinks

The world is facing an impending sugar glut as soon as Q4/10, when India’s 2010/11 sugarcane harvest officially begins and Brazil’s massive main centre-south harvest comes to an end. How big or small the surplus will be depends on weather across the key sugar-producing countries in the next nine months. In the past half-century sugar prices have always plummeted to below global (and Brazilian) production costs after peaking at decade-long highs: twice during the oil shocks of the...

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