ISMA revises India's sugar output upward by 2 pc to 26.5 million tonnes for 2019-20

Industry body ISMA on Tuesday revised the country's sugar production upward by two per cent to 26.5 million tonnes for the ongoing 2019-20 marketing year, much lower than last year but enough to meet the local demand.

It may be noted that a senior Food Ministry official on February 24 had said the total sugar output would be around 27 million tonnes this year.

Indian Sugar Mills Association (ISMA) had in November last year pegged sugar production at 26 million tonnes for the 2019-20 marketing year (October to September) considering fall in sugarcane crop in key growing states, compared with 33.16 million tonnes during the 2018-19 marketing year.

Already, about 17 million tonnes of sugar has been manufactured by mills till February 15.

Annual sugar consumption in India, the world's second largest producer after Brazil, is about 26 million tonnes.

Releasing the latest data, ISMA said: "Sugar production during 2019-20 would be slightly more than what was estimated in November 2019. ISMA has accordingly revised its sugar production estimates upwards from 26 million tonnes to 26.5 million tonnes for 2019-20.

The production estimate has been revised after considering reduction of sugar following higher production of ethanol by way of diversion of B-heavy molasses and sugarcane juice, it said in a statement.

According to the second estimate, production in Uttar Pradesh, the country's largest sugar-producing state, is estimated to be 11.8 million tonnes this year, almost similar to what the state had produced in 2018-19.

However, in Maharashtra, sugar production is estimated to drop by almost 40 per cent to around 6.2 million tonnes in 2019-20 as against 10.72 million tonnes in 2018-19.

"Based on our analysis, we expect higher yield from the balance sugarcane available for harvesting which is mainly in areas which are high yielding districts like Kolhapur, Satara, Sangli and Pune," ISMA said.

Similarly, in Karnataka, sugar production is estimated to be around 3.3 million tonnes in 2019-20 from 4.43 million tonnes in 2018-19 due to fall in cane acreage by 21 per cent.

According to ISMA, there has not been any major changes in the other sugarcane growing states of the country.

As per the second advance estimates, other states including Tamil Nadu, Gujarat, Andhra Pradesh and Telangana, Bihar, Punjab, Haryana, Madhya Pradesh, Chattisgarh, Odisha and Uttarakhand are collectively expected to produce about 5.2 million tonne this year.

On ethanol supply for blending with petrol, the industry body said 61.63 crore litres of ethanol made from B-heavy molasses and 10.60 crore litres ethanol made from sugarcane juice have been finalised from the first tender.

Another tender is under finalisation and is expected that some more ethanol supplies would be contracted, including ethanol from B-heavy molasses and sugarcane juice.

ISMA said closing stock of sugar at the end of the current year is expected to be around 10 million tonnes.

If the government continues with its buffer stocks of 4 million tonnes next year too, the net available sugar balance for market sale will be around 6 million tonnes, which is considered reasonable, it added.