Sugar output nears 25 mt, next year may see marginal drop

Cyclical nature of production and rising cane arrears likely to affect sugar production in 2012-13: ISO

The country’s sugar output has inched close to 25 million tonnes (mt) so far in the current season (October-September) of the crop, showing an increase of 13 per cent over the corresponding period of the preceding year.

The Indian Sugar Mills Association (Isma) data says 24.98 mt has been produced till April 22, compared to 22.15 mt in the corresponding period of the 2010-11 season. The production figure, according to Isma, would reach 26 mt in 2011-12. The annual domestic demand is 22 mt.

According to Isma, Maharashtra has produced 8.71 mt till April 22, which is 8.5 per cent higher than the year-ago period. Uttar Pradesh produced 6.94 mt, up by 18 per cent compared to last year. The southern states of Karnataka and Tamil Nadu, too, reported higher production of 3.75 mt and 1.52 mt, respectively.

The International Sugar Organisation (ISO) sees India’s output at 24.5 mt next year.

Domestic production in the next season, beginning this October, could dip by five per cent to 24.5 mt, while being higher than the domestic consumption of 22 mt. “Our understanding is that India’s sugar production may go down slightly from 25.8 mt this year,” said Sergey Gudoshnikoy, senior economist with the London-based ISO.

The cyclical nature of production and piling cane arrears could affect production next year, Gudoshnikoy told reporters on the sidelines of the 41st session of the International Sugar Council here.

“The production would be comfortable to meet the domestic demand,” he added.

ISO had forecast 25.8 mt production for the current season against which production is expected to cross 26 mt. Vinay Kumar, managing director of the National Federation of Cooperative Sugar Factories, says production in 2012-13 would touch 25 mt, based on current sowing.

According to Isma director-general Abinash Verma, the country will have a surplus next year. However, it “will be too early” to estimate the exact production, he noted.

According to official data, Indian farmers have planted sugarcane on 4.41 million hectares, so far in 2012-13, as compared to 4.32 million hectares in the year-ago period.