SAO PAULO, March 5 (Reuters) - Brazil's ethanol demand reached 1.37 billion liters in January, 55 percent more than in the same month a year earlier, cane industry group Unica said on Monday, as car owners switched from gasoline to the biofuel due to a large price difference at the pump.
The Unica report, based on data from oil and fuels regulator ANP, showed that ethanol consumption was the largest for any January.
Strong ethanol demand and low international sugar prices are expected to prompt mills to produce as much of the biofuel as possible in the new crushing season officially starting in April.
That would result in falling sugar output, with most analysts expecting a reduction of around 4 million or 5 million tonnes in the center-south. The global sugar market has a large surplus.
The current price difference between gasoline and ethanol is among the largest on record, Unica said, with some places in Brazil showing a gap as large as 1.21 real per liter ($1.4 per gallon). Almost all of Brazil's cars can run on either fuel.
(Reporting by Marcelo Teixeira; Editing by Richard Chang)