Sugar industry to revise output estimate
Latest expectation is for 29-30 mt in current season
The Indian Sugar Mills Association (Isma) is set to raise its production estimate for the current year due to a rise in Maharashtra’s cane yield.
The sugar year officially begins on October 1 and Isma’s estimate for the 2017-18 sugar year was 25.1 million tonnes (mt). On January 18, it raised this to 26.1 mt, based on early indications of cane yield in Maharashtra, the country’s second largest producer, where most operating mills have received the early cane variety for crushing.
However, unseasonal rain in November-December has helped cane to grow to its full potential in the state. Last year’s yield was hit by drought there. Experts now expect a record sugar output in the state.
From October 1 till end-February, the sugar output in the country has been 23.05 mt, nearly 6.8 mt higher than last year. According to Isma data issued on Monday, Uttar Pradesh has produced 7.4 mt so far and Maharashtra around 8.4 mt.
The earlier estimate of the All India Sugar Trade Association for 2017-18 was 26.4 mt. The association has revised this to 29 mt, with the Maharashtra figure raised from 8.5 mt to 10 mt and Karnataka from 2.5 mt to 3.5 mt.
“We will take a final decision on the sugar production numbers at our board meeting on Wednesday. But with the cane yield expected to remain much higher than its earlier estimate, we are confident of revising our sugar production estimate upward,” said Abinash Verma, director-general of Isma.
Initial estimates suggest the sugar output in Maharashtra at 8.2-8.5 mt. Of the 185 operational mills in the state, seven have declared closure for the season. at the outset, mills estimated 65 mt of cane availability for crushing, of around 72 mt of output estimated in the state. However,, sugar mills have already reported a total 76.76 mt of crushed cane. With an average yield of 10.99 per cent (last year’s was 11.2 per cent), they have surpassed their cumulative output forecast of 8.4 mt when the season began.
“As of now, 12-15 per cent of cane is unharvested, which will take the availability for crushing at 82-85 mt or even higher. The total sugar output in Maharashtra might comfortably cross 9 mt or even go up to 10 mt. Based on this estimate, we might see India’s sugar output at 29-30 mt,” said Sanjay Khatal, managing director, Maharashtra State Federation of Co- operative Sugar Factories.
With nearly 4 mt of carryover stock, the total sugar availability for the current season might be 33-34 mt, as against India’s consumption of 25 mt a year. The output is expected to remain high in the next season, too. The industry wants the government to allow export of 1.5 mt white sugar in this season and over 4 mt of raw sugar in the next one to “balance the interests of mills and farmers”.