Uttar Pradesh sugar output declines 13% to 6.42 mt

In 2011-12 and 2012-13, production in the state stood at 6.97 mt and 7.4 mt, respectively

In the current cane-crushing season, sugar output has dropped 13 per cent to 6.42 million tonnes (mt) in Uttar Pradesh. With the crushing season about to end soon, it is expected the final data for production won’t see much change, as only a handful of the 119 sugar mills in the state are operational.

During 2011-12 and 2012-13, sugar production in the state stood at 6.97 mt and 7.4 mt, respectively.

At the beginning of the crushing season, the Indian Sugar Mills Association (Isma) had projected production at 6.6 mt this season. In March, ISMA had revised its pan-India sugar production estimate to 23.8 mt from 25 mt earlier.

Meanwhile, the 95 private mills lead the tally in sugar production in the state (5.83 mt), followed by the 24 cooperative mills (0.55 mt) and corporation’s lone unit at 2,61,000 tonnes. The operational mills, mostly in the private sector, are likely to be shut by May 15.

Meanwhile, sugarcane arrears for this season have touched Rs 7,925 crore, with the mills’ collective payment at about 55 per cent. At about Rs 7,600 crore, private mills lead the tally for the arrears, too.

On the high arrears, Uttar Pradesh Sugar Mills Association secretary Deepak Guptara said this was partly due to non-disbursal of loans under the Centre’s interest-subvention scheme, as banks insisted on higher interest in a few cases.

“The prevailing sugar price of about Rs 3,200 a quintal ex-factory is lower than the cost of production and leaves a gap of about Rs 4 a kg, a clear deficit,” he said.

For private millers, Rs 113 crore is pending from the 2011-12 crushing season. The defaulting mills, mostly standalone units, have already had recovery certificates issued against them.

This season, the aggregate sugar recovery improved to 9.27 per cent from 9.18 per cent last year. Recovery refers to sugar produced per unit of cane crushed; higher percentage means higher output and, consequently, a higher profit margin to mills.