Brazil to lose share of sugar mkt as mills see no profit

SAO PAULO, Apr 29 (Reuters): Brazil will lose a significant share of the global sugar trade to competitors in the current season as price levels make it unprofitable for most mills to produce the sweetener, consultants and millers said on Friday.

Analysts are forecasting a reduction in sugar production in Brazil's center-south in 2018-19 of up to six million tonnes compared to the previous season. Mills are looking to produce as much ethanol as possible in search of better returns.

"Even the most efficient mills in Brazil can not make sugar at current prices," said Arnaldo Correa, a sugar and ethanol consultant with Archer Consulting in Sao Paulo.

Jacyr Costa Filho, head of Brazilian sugar operations for French producer Tereos, agreed, saying that producing sugar right now was "not sustainable."

According to data from brokerage and consultancy INTL FCStone, compiled by Reuters, Brazilian exportable surplus would fall from 30 million tonnes in the 2016-17 global crop year (October/September) to 22.2 million tonnes in the current crop year.

Tereos' Costa said current prices are below production costs for 90 per cent of producers worldwide.