Usinas Itamarati SA, the owner of a Brazilian sugar-cane mill, will invest 46 million reais ($23 million) to replace aging plants this year to restore productivity.
The company will replant 11,000 hectares (27,200 acres) of cane adjacent to its plant in the center-west state of Mato Grosso, Chief Executive Officer Sylvio Nobrega Coutinho said today in a telephone interview.
Usinas Itamarati curtailed investments in new plantations following the 2008 financial crisis, Coutinho said. Cane plants are typically cut near the stem when harvested so they will regrow during the next season, and must be replaced every five years to maintain yield.
“We didn’t have the funds” in 2009, and replanted about half the 10,000 hectares that needed to be replaced, he said. “Many other mills, including some of the bigger groups, had the same problem.”
The mill is expected to crush 5.2 million metric tons of cane this year and has capacity to crush 6.3 million tons, he said.
Usinas Itamarati’s sole shareholder Ana Claudia de Moraes Tamer is seeking to sell the company, Coutinho said. JPMorgan Chase & Co. is managing the sale and began accepting bids in March.