Insight Focus
The probability of El Niño this year exceeds 80%, according to American climate experts. Some models predict a “very strong” event. Centre-South Brazil may more frequent rainfall during this year’s cane harvest.
Early Signs of El Niño in 2026
The National Oceanic and Atmospheric Administration (NOAA) projects the formation of an El Niño in 2026, with recent signs of strengthening. Currently, the climate system is in a neutral phase, after the weakening of La Niña observed in 2025, but this could change soon.
The phenomenon should begin to take shape between May and June, gaining intensity throughout the second half of the year. For the last quarter of the year, the probability of occurrence is already close to 80%.
Projections now indicate that any EL Nino event may reach a strong intensity at the end of 2026. Some climate models, such as the ECMWF (European Centre for Medium-Range Weather Forecasts) do not rule out an even more intense scenario, although this can only be predicted with greater precision from July onwards. In the current scenario, the main indication is of an event closer to the 2023 El Niño.
Although the South and North/Northeast regions are historically the most impacted by El Niño and La Niña events, episodes of strong intensity tend to generate more significant effects also in the Centre-South of Brazil.
The expectation is for more frequent and irregular precipitation in the Centre-South, especially during the rainy season, when El Niño tends to be more intense. Even so, projections already indicate the beginning of the phenomenon from June, which can bring episodes of rain even during peak moments of the cane harvest.
Downside Risk for Cane Quality
The impact that the rains may have on the sucrose yield (ATR) is a point of attention. Under normal conditions, during rainier periods the ATR of sugarcane drops, especially when the harvest is already nearing the end. However, the occurrence of unseasonal rains, between June, July and August (when the CS harvest is still in full swing) may advance this reduction in the ATR. Therefore, there is a risk of a decrease in the sugar crystallization capacity of the mills.
We already believe mills will allocate more cane to ethanol this year than they did last year. Sugar prices are low and the mills haven’t hedged as much sugar as they normally do. The possibility of another unfavourable factor for sugar (lower crystallization capacity) tends to reinforce this view that the mix will be focused on ethanol.
Thus, there is a downside risk in our current ATR forecast for the 2026/27 cane harvest, which is currently 139 kg/tonne and, consequently, for CS sugar production. According to our models, for every 1 kilogram of ATR lost, at least 300 thousand tonnes of sugar would not be produced.
Delays in Field and Port Operations
Another point of attention is the delay of the harvest due to the rains. This rainy scenario caused by El Niño can increase the number of days of stoppage both in field operations and in port activities.
In 2023, when we had the last El Niño of strong intensity, 20 crushing days were lost between April and September. The industry can crush 3 million tonnes of cane per day in the peak of the harvest.
We will follow the development of the phenomenon for the next few months. The new NOAA report, which is due on April 9, will provide more updates on the expected intensity of the phenomenon.
