Sugar production till mid-February in the current season to September is down by 13 per cent at 14.37 million tonnes (mt) against 16.58 mt during the same period a year ago. The lower production is due to delayed start to the crushing season.

At the same time, cane arrears or the payments to be made to farmers by the sugar factories till date have exceeded ₹12,000 crore, according to the Indian Sugar Mills Association. As sugar prices continue to be caught in the bearish price trend on surplus availability, millers are finding it difficult to make payments to farmers.

Uttar Pradesh topped cane arrears list with payment dues estimated at ₹8,000 crore, followed by Karnataka at ₹3,000 crore. Maharashtra is estimated to have arrears of ₹300 crore, followed by Gujarat at ₹200 crore with other states accounting for the rest, ISMA said.

Factories in Maharashtra have produced close to five million tonnes of sugar, followed by Uttar Pradesh at 3.57 million tonnes and Karnataka at 2.7 million tonnes.

Crushing season

The cane crushing season this year was delayed by about a month over the issue of pricing, but the industry expects to make up for the delayed start during the course of the season. It has pegged the output at 25 million tonnes.

ISMA said sugar recovery in Maharashtra is marginally higher at 10.96 per cent this year. However, by mid-February, about 10 factories in Maharashtra closed their operations this year compared with eight in the corresponding period a year ago.

Also in UP, sugar recovery this season is marginally higher at 8.91 per cent. Sugar output in Gujarat is estimated at 7.5 lakh tonnes, while in Andhra Pradesh it is projected at 6.6 lakh tonnes. Tamil Nadu production has been pegged at 4.5 lakh tonnes.

ISMA said that total raw sugar production in the country touched 8 lakh tonnes till January.

Factories, mainly in Maharasthra and Karnataka are expected to produce another 10 lakh tonnes in the current season. The Government last week announced an export incentive of ₹3,333 a tonne for export of raw sugar to be made over the next two months.

Sugar exports in the current season till January this year were estimated at 8.5 lakh tonnes of which raw sugar accounted for more than half the quantity shipped at 4.5 lakh tonnes. Refined sugar accounted for the rest.

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