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Sugar mills produced over 110 lakh tonnes (lt) of sugar in first three months of the current sugar season — nearly 41.9 per cent more than the corresponding period last year — and signed deals for exporting 10 lt of sugar already, said Indian Sugar Mills Association (ISMA) on Monday.
Till December 31 last year, 481 mills currently crushing sugarcane in the country produced 110.22 lt as compared to 77.63 lt produced by 437 mills in the same period last year, an ISMA statement said.
Bright export prospects
Indian sugar mills have a brighter chance of securing more export deals this year as sugar production in Thailand, the second largest exporter, is nearly 80-90 lt lower than the normal levels. This opens up many markets to Indian sugar, including Indonesia and Malaysia, apart from traditional markets such as West Asia, Sri Lanka, Bangladesh and East Africa till the time Brazilian sugar hits the global market in March-April, the sugar industry body said.
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Rs 2,170 cr out of a total payable Rs 4,148 cr paid to farmersThe global prices, however, are expected to fall from April as the estimated sugar production is projected to be a record 380 lt and this could hit potential export prices for Indian millers in future.
Higher output
Sugar production by 179 mills in Maharashtra was nearly 40 lt (16.5 lt). On the other hand, 120 Uttar Pradesh mills crushed enough sugarcane to produce 33.66 lt, which is marginally higher than what was produced in the corresponding period in the previous sugar season.
In Karnataka, sugar production so far was 24.16 lt which is nearly 8 lt more than the corresponding period last year. Other sugar producing States together produced nearly 12 lt till date, according to ISMA.
Inverse futures prices
ISMA said the world trade happens in relation to the futures prices in the London ICE exchange for white sugar and New York exchange for raw sugar. Currently, sugar contracts are happening in relation to the March futures, but in a couple of months, the same will happen with respect to May futures, which is substantially lower as compared to March futures. “The global futures market is inverse and therefore, as the season progresses, the sugar export prices are expected to be lower as compared to what one is getting currently,” it said.
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