Sugarcane crushing operations are set to come to a close and mills across the country, the world’s second largest sugar producer, have produced 279.57 lakh tonnes (lt) of the sweetener between October 1 and May 31.

Output is likely to match the record production of 283.61 lt achieved in 2006-07, according to the industry association.

This latest estimate released by the Indian Sugar Mills Association (ISMA) on Wednesday is 16.3 per cent higher than the 240.49 lt produced over the same period in the 2013-14 season (October-September).

“…It is estimated that sugar production for the full season of 2014-15 would be around 283 lt, similar to that in 2006-07, which was then the highest ever produced in the history of the Indian sugar sector,” said an ISMA statement.

Domestic consumption is pegged at 248 lt and sugar prices having fallen to their lowest since 2009 at 12 cents/lb. ISMA estimated a likely stock of 103 lt at the end of the season, higher than the normative requirement of 60 lt the Government required in the initial months of the new season.

Mills have moved 5.58 lt for raw and white sugar exports this season, of which 3 lt of raws were exported under the incentive scheme. “It is expected that not more than 2 lt of sugar would get exported during the remaining period,” the statement said.

Different situation

ISMA contended that the situation in 2006-07 was better and the season ended with 110 lt of stocks, which the Centre helped clear.

Among the measures it took were the creation of a 50-lt buffer stock in two tranches over a two-year period, incentives on sugar exports for 60 lt, and interest-free loans amounting to Rs 3,800 crore in the 2007-08 season.

Food Minister Ram Vilas Paswan earlier this week said a buffer stock was not being considered by the Ministry.

For the 2014-15 season, mills owe farmers Rs 22,000 crore and it was the fifth consecutive year of surplus production. Farmers are unlikely to reduce their cane area and prices in both the domestic and global markets have fallen to their lowest levels in the last six-seven years.

“This has worsened the financial health of the sugar industry, due to which banks are not coming forward to lend further loans…The Government should immediately come out with some substantial assistance for sugarcane farmers and the industry,” it said.

State-wise output

Mills in Maharashtra, the country’s largest sugar producing State, have produced 104.75 lt of sugar, 28 lt higher than at the same time in 2013-14. Mills in Uttar Pradesh and Karnataka have recorded output of 70.9 lt and 48.99 lt, 6 lt and 8 lt higher respectively.

Mills in Tamil Nadu, which has a special crushing season between August and September, have produced 10 lt so far, lower than the 11.8 lt registered at the same time last season. Overall, only 19 mills were crushing cane as of Wednesday.

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