Sugar output drops by close to a third

Production in first 3 months of marketing year at 7.79 MT, prices remain stable, exports at good pace

Updated - January 02, 2020 10:37 pm IST

Published - January 02, 2020 10:20 pm IST - NEW DELHI

The country’s sugar production has fallen sharply by 30.22% to 7.79 million tonne (MT) in the first three months of current marketing year ending September, but ex-mill prices have remained stable so far, helping mills clear cane payment to farmers on time, ISMA said.

However, sugar exports are happening at a good pace, Indian Sugar Mills Association (ISMA), quoting market data, said, adding mills have so far contracted for shipment of over 2.5 MT of sugar under the government’s MAEQ (Maximum Admissible Export Quantity Quota).

Ex-mill sugar prices have remained steady in the range of ₹3,250-3,350 per quintal in north India and at ₹3,100-3,250 per quintal in south India, ISMA added.

“Since the Centre has not increased the fair and remunerative price (FRP) for 2019-20 as also State governments like Uttar Pradesh, Uttarakhand and Punjab have not hiked the state advised price (SAP), ex-mill prices remain stable and mills are in a better position to be able to pay cane prices to the farmers on time,” ISMA said.

Releasing the latest production data, it said the country’s total sugar production has dropped to 7.79 MT till December 2019 from 11.17 million tonne in the same period of the 2018-19 marketing year (October-September).

In its first estimate, ISMA had pegged sugar production lower at 26 MT this year from 33.16 MT in 2018-19.

Sugar production in Maharashtra — the country’s largest sugar producing State — dropped to 1.65 MT till December 2019 against 4.45 MT in the same period last year, the data showed.

Sugar recovery

The average sugar recovery in Maharashtra has declined to 10% from 10.5% achieved in the year-ago period due to loss of sucrose content in the flood-affected sugarcane crop.

About 137 sugar mills were in operation till December 2019 against 189 mills in the same period last year.

Production in U.P. rises

Production in Uttar Pradesh, the country’s second largest producing State, rose to 3.31 MT so far compared to 3.10 MT a year ago.

On exports, ISMA said the government is in the process of reviewing actual exports made by mills against MAEQ during October—December 2019 quarter, and has already announced in the policy to reallocate unexported quota to the sugar mills that have exported and are willing to take additional quota beyond their MAEQ.

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