India’s sugar output may fall next season as cane likely to diverted for higher ethanol production

India‘s sugar production will likely be lower next season starting October as more sugarcane may be diverted towards production of ethanol amid an expected drop in Maharashtra output. This may potentially reduce the prospect of exports as the Centre may prioritise domestic availability due to the General Elections scheduled in first half of 2024.

However, the Government is yet to take an assessment from the cane commissioners of the sugarcane-growing States. A view may be firmed up over the next month since the weather bureau has predicted below normal monsoon in August.

Indian Sugar Mills Association (ISMA), an association of private mills, on Wednesday released the preliminary estimates of production for the 2023-24 season starting October, pegging the output (after diversion towards ethanol) at 31.68 million tonnes (mt), lower than the estimated 32.8 mt in the on-going season.

• Also read: Sugar industry seeks hike in ethanol price by 6.5% in 2022-23

Lower acreage

ISMA said 4.5 mt of sugar is likely to be diverted for ethanol production against 4.1 mt in the current season. Actually sugar is not diverted to produce ethanol, which is made out of molasses or sugarcane juice/syrup or grains. The estimate is based on how much quantity of sugar could have been produced had there been no diversion towards ethanol.

As the special season 2022-23 is in progress in Karnataka and Tamil Nadu, final production figure will be compiled later.

• Also read: Indian sugar industry ready to ramp up ethanol capacity

The production estimates were finalised at the (executive) committee meeting of ISMA, held on August 1, where images of the cane area, expected yield, sugar recovery, impact of rainfall, water availability in reservoirs, expected rainfall in remaining season and other related aspects were discussed, the industry body said in a statement.

The industry body said according to its information based on satellite images collected during later half of June, the total acreage under sugarcane in the country is around 59.81 lakh hectares this year against 59.07 lh last year. There is an estimated drop of 9 per cent area in Tamil Nadu and 4 per cent in Karnataka, whereas both Uttar Pradesh and Maharashtra are reported to have more acreage under sugarcane.

However, industry sources said Maharashtra may have lower sugar output due to deficit rainfall in most parts of June and July which is likely to cut the yield. Even the Government has pegged the acreage of cane lower at 10.54 lh this year against 12.14 lh previous year in Maharashtra.

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