Commodity - Brazil's ethanol production premium surpasses 200 points over sugar.

Byline: S. KAMAL HAYDER KAZMI

A 7.8percent jump in Brazil's Center-South hydrous ethanol price combined with a 6.8percent appreciation in the real against the dollar from March 10 to April 1 were the primary reasons for ethanol's spike in production premium. NY11 May sugar futures posted a meager 1.4percent price rise over the same period.

The ethanol production premium to sugar in Brazil moves closer to 240 points if decarbonization credits, CBIOs are added into the premium calculation. The CBIO, equivalent to 1 mt of carbon dioxide not released in the atmosphere, is an instrument issued by biofuel producers and importers to ensure Brazil attains its future decarbonization targets.

"Although the 2022-23 crop should witness a relatively high...