The Hindu Business Line : Maharashtra mills crush less cane, produce less sugar

New Delhi, Nov. 28 Sugar production in Maharashtra is down 27 per cent, with mills crushing almost 35 per cent less cane so far during the current 2007-08 season (October-September).

As on Tuesday, the 118 mills operational in Maharashtra during the current season had crushed 71.99 lakh tonnes (lt) of cane and produced 7.87 lt of sugar at an average recovery of 10.93 per cent. During the corresponding period of the 2006-07 season, there were 154 mills in operation and they crushed 110.10 lt of cane, producing 10.77 lt of sugar at an average recovery of 9.78 per cent.

But these figures, made available by the Maharashtra State Cooperative Sugar Factories Federation (MSCSFF), need to be interpreted with caution. The main reason for lower crushing till now, a MSCSFF official explained, had to do with the late Diwali this time. Last year, Diwali was on October 21, whereas this year, it happened on November 9.

“Normally, crushing takes off only after Diwali when you get labourers for harvesting the cane. This time, the late Diwali meant most mills could really start only by mid-November,” the official said.

He felt that the present gap in crushing and sugar output over the last season would be bridged over the coming weeks and “we will end up producing more or less the same quantity of sugar”.

Higher recovery

In fact, mills have recorded higher recovery rate this season compared to that in 2006-07. “We have had good rains before Diwali and the overall weather has been very conducive to the crop. So, I don’t anticipate any decline in either cane crushing nor sugar output,” the official added.

That may not be terribly sweet news for the country’s beleaguered sugar industry, which is currently reeling under an unprecedented glut. The 2006-07 season saw sugar output touch an all-time-high of 282 lt, against the 192.67 lt of 2005-06.

The 282 lt included 90.8 lt of Maharashtra, 85.3 lt of Uttar Pradesh, 26.5 lt of Karnataka and 24.5 lt of Tamil Nadu.

The new 2007-08 season has opened with estimated stocks of 115 lt, equivalent to nearly seven months’ domestic consumption. Assuming production to be at last season’s level, domestic consumption of 210 lt and exports of 40 lt, mills would end the season with even higher stocks of 140-150 lt.

Amidst this dismal prognosis, industry insiders have been holding out hope of some ‘positive’ news or the other — lower crushing in Maharashtra, diversion of cane to gur and khandsari in Uttar Pradesh, uptrend in world prices, and so on. As of now, none of these seem close to materialising.

Above estimates

At the same time, nobody would like to take chances after last season’s disastrous projections. For instance, till even as late as February, Maharashtra mills were expected to crush around 600 lt of cane and produce 69-70 lt of sugar. As against this, they actually ended up crushing a mammoth 798 lt and producing almost 91 lt!

Uttar Pradesh, too, similarly produced 85.3 lt, against the earlier estimated 70 lt.