Maharashtra's sugar output expected to hit 6-year low

Dip is due to fall in sugarcane area and availability of the crop for crushing

The sugarcane crushing season in Maharashtra will start from December 1, instead of November 1, because of prolonged rains and inadequate stock. The state’s sugar output is expected to be five million tonnes (mt), the lowest since 2010-11. It was 8.41 mt in 2015-16.

The fall is also because of the decrease in area under cultivation to 633,000 hectares (ha) against 987,000 ha a year ago. Cane available for crushing is also expected to fall from 74.3 mt to 49.3 mt.

Besides, around 140 sugar mills (70 cooperative and the rest private) are expected to participate in crushing, against 177 (99 cooperative and 78 private mills) in 2015-16.

These estimates were released by the state government at a meeting chaired by Chief Minister Devendra Fadnavis and his Cabinet colleagues with representatives of the industry held late Monday night. The government and industry representatives arrived at a consensus on December 1 as the date for beginning the crushing season as fields are waterlogged, which will impact sugar recovery.

The Federation of Cooperative Sugar Factories in Maharashtra, a body of around 200 mills, has appealed to the state government to waive the three per cent sugarcane purchase tax, restructure loans with three-year moratorium and seven-year repayment schedule, and provide 75 per cent subsidy for drip irrigation. The federation said rescheduling and restructuring of loans was done by the Centre in 2007 to avoid accounts getting declared as non-performing assets.

The National Federation of Cooperative Sugar Factories’ Chairman Dilip Walse-Patil, who was present at the meeting, told Business Standard, “The state government needs to be proactive in providing help, as the sugar industry is going through a difficult phase. The government will have to take immediate steps for improving ease of doing business, especially in getting approvals and crushing licence in a time-bound manner.''

Fadnavis told industry representatives that he has asked the commissioner of sugar to give approvals online. Besides, he assured them that he would take up their demand for restructuring loans with the Union finance ministry.