Sugar production likely to increase marginally

India’s sugar production in the 2011-12 crop marketing year, that starts from October, is expected to be around 24.6 million tonnes (mt), just 1.2 per cent more than this year’s output, food minister K V Thomas said on Wednesday.

The government estimates are almost 1.4 mt less than that of the industry.

“This week, we had a meeting of sugarcane commissioners from 11 major producing states, along with representatives from the agriculture department. We feel sugar production in the next crop year is expected to be around 24.6 mt,” Thomas told reporters.

He said the area under sugarcane in 2011-2012 was expected to be 5.02 million hectares, up 1.6 per cent from last year. Cane production is expected to be 342.2 mt, up from 339.16 mt this year.

“The production estimate is the first for next year and can vary as the season progresses,” Thomas said. He said output wouldn’t be less than 24.6 mt, as it was a conservative estimate. On allowing more sugar export, the minister said any decision would be taken only after the festival season is over in October.

“Post Diwali, we will assess the sugar availability situation and then take a call on whether any more exports should be allowed,” Thomas said.

The government has already allowed export of 1.5 mt of sugar under the open general licence this year. Industry players feel there is scope for more, as output is projected to rise.

“Because of the steps taken by us, the total sugarcane arrears accruing to farmers this year is Rs 744.43 crore as on August 31,” the minister said.

On the recent demand by the edible oil industry to raise the import duty on refined palm oil and revise the rate structure, Thomas said he had received their representation and raised the issue with the finance and commerce ministries.

“The issue of increasing import duty is under the finance ministry and that of stopping import of packaged edible oil into India is with the commerce ministry. I have spoken to both and apprised them of the concerns expressed,” Thomas said.

Yesterday, representatives from the edible oil industry said the sector could come under grave danger because of lowering of the export tax on refined oils by Indonesia, one of the largest suppliers of edible oils to India.

They had demanded a rise in the domestic import duty to save the local industry. The minister also said any decision on allowing foreign direct investment (FDI) in the retail sector should be allowed only after taking into account the interest of small traders and shopkeepers.

“We (the food and consumer affairs ministry) have some view of FDI in retail and will convey the same to all the concerned ministries and departments,” Thomas said.