The physical sugar market had a month of July marked by important accelerations of the average trading of crystal sugar with up to Icumsa 150 traded in the interior of São Paulo. In 2020, prices rose nearly 28%, while in the margin they stood below 1%.
In this context, it is worth mentioning that in the annual comparison there is a strong statistical load compared to very low prices for crystal with up to Icumsa 150 at this time of the year. Even so, there is real growth in the margin. The June average of BRL 75.80 reached BRL 76.45 in July. SAFRAS & Mercado warns that new increases in the margin are expected for August and also for the coming months.
On the one hand, there will be a seasonal pressure from the off-season from October. But long before it, the demand from distribution industries, basically until November, will guarantee levels sustained above BRL 76.00 a bag in the most pessimistic projections. It is important to put in context the demand for crystal sugar with Icumsa 150 by the processing industries that operate in the market more intensely between May and October. The months from November to April are marked by the almost total absence of new contracts with mills. The risk management stance of industries ends up removing these entities from the market in the off-season.