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Brazil sugar exports to be spared port jam in 2012
March 14, 2012 / 4:07 PM / 6 years ago

Brazil sugar exports to be spared port jam in 2012

* Weather seen dry during peak of bulk-loaded exports
    * Noble adds sugar capacity with new bulk-loading terminal

    By Peter Murphy	
    BRASILIA, March 14 (Reuters) - Shipments of sugar
should flow smoothly from top producer Brazil this year with
long-range weather forecasts pointing to a dry winter, cutting
the risk of a repeat of the disruption two seasons ago that sent
prices of the sweetener soaring.	
    The opening of an additional bulk-loading terminal at key
sugar port Santos and the deepening of canals there and at
Paranagua are additional assurance that long and costly delays
for loading are improbable, shippers and forecasters said.	
    Torrential rain in 2010 slowed sugar loading in Brazil,
forcing more than 120 ships to wait for weeks to pick up their
cargo at Santos and Paranagua. Even small amounts of rain
falling into ships' holds can damage sugar loads, making the
product hard and lumpy.	
    "We expect it should be quite fine in terms of sugar
loading. Our expectation is that things will be similar to last
season," said Nicolle de Castro, commercial assistant at
Santos-based SA Commodities/Unimar brokerage and shipping agent.	
    Loading disruption in 2010 coincided with a spike in sugar
demand when supplies from some Asian sources faltered. The melee
helped New York sugar futures roughly to double to around
28 cents per lb between the start and peak of harvesting.	
    Costs for shippers also headed skyward when rain held up
loading in 2010. Demurrage charges alone are typically around
$15,000-$30,000 a day.        	
    That year the El Nino weather anomaly, which turns southern
Brazil wetter than normal, halted round-the-clock sugar loading
for days. Its opposite, La Nina, brought dryness this year but
the anomaly is fading. Though forecasters say an El Nino could
recur, its effects will not be seen until after harvest's peak.	
    "In autumn, by the end of March we should already have
neutral (El Nino/La Nina) conditions, which should be observed
through autumn and through the winter also," said Olivia Nunes,
meteorologist at Sao Paulo-based Somar Meteorologia.	
    "It won't be a wet winter but it will be one with normal
levels of rain," she said.	
    Somar's forecasting models made no prediction of another El
Nino but U.S.-based World Weather Inc said it expected the
anomaly to kick in late in the year. It cautioned forecasters
were still not in unison on the likelihood it would occur.	
    Reinforcing capacity, Asia's biggest commodities trader,
Noble Group, inaugurated a sugar-loading terminal in
Santos in October last year, adding nearly 11 million tonnes a
year of bulk capacity to that port.	
    Brazil exported about 26.5 million tonnes of sugar, raw and
refined, in 2011, trade ministry data shows.	
    The new terminal adds welcome extra capacity as Brazil
pursues rapid expansion of cane production, despite a setback
last season when poor weather and ageing plants hit yields and
caused output to slip after a decade of nonstop growth.	
    Further limiting pressure on the port, sugar output should
grow only modestly this season. Cane output is set to recover
partially this year, analysts say, but it will still fall short
of the record 2010 season. 	
    Rumo Logistica, the logistics arm of major Brazilian sugar
producer Cosan, has announced plans to install a
rigid canopy stretching over the berth to cover ships' holds and
enable all-weather loading but works have still to commence.	
    The exploding of two huge rocks in the access canal to
Santos and the removal of a freighter that sank decades ago will
also enable larger vessels to dock once dredging has been
carried out at the berths, de Castro said.	
 (Editing by Todd Benson, Reese Ewing and Dale Hudson)

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