The Indian Sugar Mills Association (ISMA), the apex body of private mills, has demanded that the Government increase the sugar export quota by one million tonnes (mt) from the current 10 mt.

With 94-95 lakh tonnes of sugar export contracts entered into so far, about 86 lakh tonnes were physically exported till May 2022 against the backdrop of the government recently capping the exports at 100 lakh tonnes for the current season, according to the Indian Sugar Mills Associations (ISMA).  The apex sugar body has now demanded that the government must increase the export quota.

ISMA has revised its all-India sugar production estimate for the 2021-22 sugar season to 360 lakh tonnes after considering the diversion of 34 lakh tonnes of sugar equivalent into ethanol. It is notable that last year, the country produced 311.92 lakh tonnes of sugar after a diversion of about 20 lakh tonnes for ethanol production.

ISMA, in a statement, added that as per its estimates and reports from the sugar mills , sugar sales by the end of April 2022 have been at 160.05 lakh tonnes, as against 152.61 lakh tonnes in the corresponding period last year, a rise of about 7.5 lakh tonnes.

The domestic sugar sales quota released by the government up to June 2022 is higher by 5.5 lakh tonnes against the corresponding period last year. ISMA estimates domestic sugar consumption in the current season to be at 275 lakh tonnes against 265.55 lakh tonnes last year.

Demand to increase export quota

Considering an opening stock of about 82 lakh tonnes as of October 1, 2021, with 275 lakh tonnes of domestic consumption, 100 lakh tonne tonnes of exports, and the estimated 360 lakh tonnes output, the closing stock as of September 30, 2022 is likely to be at 67 lakh tonnes, sufficient for three months of domestic consumption.

ISMA President Aditya Jhunjhunwala speaking to BusinessLine, said, “ ISMA in its Committee meeting reviewed the sugar production from 350 lakh tonnes to 360 lakh tonnes, mainly due to higher cane availability in Maharashtra, Karnataka and Tamil Nadu. As the sugar production is estimated to be higher now at 360 lakh tonnes, we expect consumption to be at 275 lakh tonnes, leaving a closing balance of about 67 lakh tonnes. With the estimate of higher production, government should allow the industry to export another 10 lakh tonnes in the current season. This will leave sufficient balance of stocks for 2.5 months of sugar consumption.”

He added that in the earlier export order released for the sugar mills dated June 6, 2022, out of the applications for exporting 17 lakh tonnes, the release orders were issued only for 8 lakh tonnes.

“The industry requests the government granting an additional 10 lakh tonnes of export order for sugar mills alone, instead of giving it to the traders/exporters, to fulfil export commitments,” he said.  

During the 2021-22 sugar season, 522 sugar mills started crushing operations as against 506 mills operated last year. About 352.37 lakh tonnes of sugar have been produced till June 6, 2022, as against 307.41 lakh tonnes produced in the previous year at the same time.

Mills still crushing sugarcane

As of June 6, 2022, about 493 mills have stopped crushing while 29 are still crushing, most in Maharashtra.

ISMA panel discussed that since the special season is in progress in Tamil Nadu and Karnataka, and the cane availability in these States are good for the remaining period up to the end of the current season, about 6 lakh tonnes of sugar is expected to be produced collectively by these States. 

ISMA added that it would obtain satellite images of the sugarcane area across the country this month to get an idea of the acreage under sugarcane available for harvesting next year. Accordingly, the ISMA, in its July meeting, would discuss the preliminary estimates for the 2022-23 sugar season.