Brazil’s sugarcane crush is expected to fall for the second year in a row in 2025/26 due to dry conditions in the Center-South, the main producing region. Mills are projected to process 593 million tons of cane next season, down from 613 million tons in 2024/25, according to StoneX. Rains are “extremely necessary” in the coming months, as the region has been experiencing a water deficit since November 2023.

Precipitation has been 30% below normal levels since March, and the adverse weather may negatively impact crop yields. However, sugar content in the cane is expected to increase by 0.5%, which could allow mills to increase sugar production by 2.5%, reaching 40.6 million tons. Cane production from an area estimated between 54,000 and 160,000 hectares may have been lost due to massive fires in recent weeks, StoneX estimates.