Financial Daily from THE HINDU group of publications
Saturday, Sep 10, 2005
Financial Daily from THE HINDU group of publications Saturday, Sep 10, 2005 |
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Exports & Imports Agri-Biz & Commodities - Sugar Raw sugar imports may continue next season — 15 lakh tonnes likely to bridge demand-supply mismatch M.R. Subramani
Chennai , Sept. 9 RAW sugar imports are likely to continue during the next season beginning October despite projections of a 40 per cent rise in production. According to Cris Infac, raw sugar imports could be equivalent to 15 lakh tonnes (lt) of white sugar and will take place in view of production being unable to meet the demand. It will be the third consecutive season when supply will not be meeting demand. In its annual sugar review, Cris Infac said production could rise to 175 lt.
But demand was likely to be around 192 lt, leading to imports for balancing the need. Sugar industry sources said there would be a little gap between supply and demand and in view of the Centre's policy on imports, there should be no problems. Imports will, however, be lower than 20-lt shipments done this season. Looking forward, it said sugar production could touch 197 lt next season with demand rising to 199 lt. But thereafter, production was likely to exceed demand. Cris Infac also said the prices were expected to rule steady between Rs 1,700 and Rs 1,800 a quintal during the next 18 months. However, things could change if the Centre de-controls the sugar industry as envisaged from October this year as recommended by the Tuteja Committee. Currently, the Centre controls the release of sugar into the open market through a release mechanism. Under this, each sugar mill can sell only a stipulated quantity every month. The Union Food and Agriculture Minister, Mr Sharad Pawar, has ruled out de-control of the sugar sector now. According to Cris Infac, sugar production has been on the downswing since 2003-04 season due to substantial rise in arrears to sugarcane farmers, drought, infestation of woolly aphid pest on the crop, lower yield and sale of cane to alternate sweetener manufacturers. The rise in production next season has been driven by increase in area under sugarcane. According to the Agriculture Ministry, the area under sugarcane has increased to 41.37 lakh hectares during the current kharif season from 37.5 lakh hectares during the corresponding period a year ago. Cris Infac said production in all major producing States was likely to increase with Maharashtra leading the recovery. Dwelling on consumption, Cris Infac said it was likely to rise in tune with increase in population. The per capita sweetener consumption would rise from 25.1 kg in 2003-04 to 25.5 kg by 2009-10. During the same period, per capital sugar consumption is likely to rise from 16.9 kg to 18.9 kg. It estimates sugar inventories to have declined to 45 lt from a high of 125 lt during 2002-03. The stocks are sufficient enough to meet three months' demand and the situation was likely to continue till 2006-07 season. The report said sugarcane production was likely to increase in view of the farmers being paid the arrears and the Union Government fixing remunerative prices for the cane. This could help the country turn a net exporter of sugar in 2008-09.
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