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SAO PAULO, March 19 (Reuters) - A sharp decline in Brazil’s currency should help its sugar producers regain market share globally, the top executive at the country’s largest sugar and ethanol group, Cosan SA, said on Thursday.
Expectations that the real’s 23 percent slump this year will extend in coming months will make local sugar producers more competitive, said Marcos Lutz, Cosan’s chief executive officer. The weaker real will also force producers with an onerous cost structure out of the market, he added.
The Brazilian real, which this week touched the lowest level in over 12 years, is the worst performer among 152 currencies tracked by Thomson Reuters. Since Brazil is a large commodities producer, the real slide is starting to affect trade flows.
Brazil is again exporting ethanol to the United States and soy producers are taking advantage of the weak real to speed up exports, congesting ports.
Brazil is about to start processing its new cane crop and Lutz noted that rains, in the center-south region in recent weeks, had been beneficial to crops in general.
Raizen Energia SA, Cosan’s energy and fuel distribution joint venture with Royal Dutch Shell Plc, is Brazil’s largest producer of sugar and ethanol. (Reporting by Marcelo Teixeira; Editing by Guillermo Parra-Bernal and Tom Brown)