Sugar mills across the country produced 263.56 lakh tonnes (lt) till April 15 in the 2013-14 season ending September – 32.06 lt higher than last year’s 231.50 lt – according to the Indian Sugar Mills Association (ISMA).

Saddled with surplus According to ISMA, with around 290 sugar mills still continuing cane crushing operations, it seems the country will produce over 270 lt of sugar in the current season, indicating a surplus of over 22 lt over the projected domestic consumption of 248 lt.

“Therefore, the closing balance of September 30, with the sugar industry will be over 90 lt. This is after considering a few lakh tonnes of exports,” the sugar industry body said.

Mills and crushing Out of the 530 sugar mills that started cane crushing this year, 240 have already closed down and 290 mills are still continuing crushing operations.

Of these, 100 mills are in Maharashtra, 50 in Uttar Pradesh, 44 in Karnataka and 36 in Tamil Nadu.

Mills in Maharashtra produced 99.61 lt for the period under review against 74.43 lt during the same period a year ago. In UP, mills produced 67.85 lt till April 15, which is 5.30 lt higher than last season’s production.

“One of the main reasons for increase in production is increase in recovery percentage of sugar,” ISMA said, adding, “during the current year, till April 15, sugar recovery has been around 9.53 per cent against last season’s cumulative average of 9.29 per cent. There are 50 sugar mills working as on April 15, against 42 last year.”

Sugar output in Karnataka stood at 45 lt against 41.18 lt last season with 44 mills still working.

Last year, as on April 15, only 18 mills were in operation.

State-wise break-up In Tamil Nadu, mills produced 8.25 lt of the sweetener. Of the 44 mills that operated during 2014-15 sugar season, eight have already shut operations and 36 are working. In 2013-14, production in the State was 10.12 lt with 26 mills in operation. Mills in Gujarat produced 11 lt of sugar and 14 mills are still working. During the same period last year, 11.53 lt was produced and six mills were working.

“Crushing operations in Andhra Pradesh and Telangana have almost come to an end, as only four mills are working as of now,” said ISMA. Till April 15, mills in these States produced 8.75 lt, against 9.77 lt last year.

Sugar mills of Punjab and Haryana produced 5.25 lt and 5.20 lt, respectively. Last year, on April 15, mills in these States produced 4.69 lt and 5 lt, respectively. During the current season, nine mills in Punjab and 10 in Haryana are still working.

Prices dip ISMA said domestic ex-mill prices had fallen by ₹8-9/kg in the last six months. Sugar prices are at the lowest in the last seven years, it said, adding that these prices are below the cost of production by ₹7,000-9,000/tonne.

Mounting arrears Incidentally, cane price arrears payable to the farmers stood at ₹19,300 crore, ISMA said, adding that the situation “is alarming.”

It called for steps to improve ex-mill sugar prices without further delay and ensure mills get adequate cash flows.

“The surplus sugar inventory of 30-35 lt over and above the normative carry forward of 60 lt as on October 1, should be disposed of,” said ISMA

On the government announcing higher import duty from 25 per cent to 40 per cent, ISMA said it will be helpful, but only in the longer run. “The immediate problem of cash flows and the surplus sugar inventory needs to be addressed first,” it added.

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