Sugar output may drop 14 pc to 28.2 MT in next marketing year: ISMA

India's sugar production is estimated to decline 14 per cent to 28.2 million tonne in the next marketing year starting October, mainly due to fall in sugarcane acreage due to less rains in states like Maharashtra and Karnataka, according to industry body ISMA.

Sugar output is likely to be at 32.95 million tonne (MT) in the current 2018-19 marketing year (October-September), Indian Sugar Mills Association (ISMA) said in a statement.

Mills have produced 32.8 MT of sugar till June and another 0.1-0.15 MT is expected during the next three months, taking the total output to 32.9-32.95 MT. The annual domestic demand is around 26.5 MT.

"ISMA estimates production of about 28.2 MT of sugar in the season 2019-20, which is about 4.7 MT lower than the current 2018-19 sugar season production of around 32.95 MT," the association said in a statement.

This estimated production is based on assumption of normal rainfall and other optimum conditions, it added.

"Based on the satellite images procured in the latter part of June 2019, the total acreage under sugarcane in the country is estimated to be around 49.31 lakh hectares in 2019-20, which is over 10 per cent lower than 2018-19 sugar season's cane area of around 55.02 lakh hectares," ISMA said.

As per ISMA estimates for the next marketing year 2019-20, sugar production in Uttar Pradesh is seen at around 12 MT, almost same as 11.82 MT in the current year.

"The other major sugar producing state, Maharashtra's cane area has gone down by about 30 per cent for 2019-20, mainly due to poor rainfall from September 2018 onwards, followed by low reservoir levels, which adversely affected sowing of 15 month and 12 month crops," the association said.

Sugar production is, therefore, estimated to decline at around 7 MT from 10.71 MT in 2018-19.

Similar to Maharashtra, due to poor rainfall in cane growing areas, sugarcane area in Karnataka has also decreased for 2019-20, ISMA said. Sugar production in the state is estimated to fall at 3.5 MT from 4.36 MT in 2018-19.

ISMA said this is a preliminary estimate of sugarcane and sugar production for 2019-20 marketing year.

"After considering rainfall in July-September 2019, water situation in reservoirs and second set of satellite images in September-October 2019 for across India, ISMA will review the analysis and release its first advance estimates. By that time, the crop will be more mature and there will be more clarity on the rainfall and water availability," the association said.

ISMA said the opening stocks of sugar is expected to be at an all-time high of around 14.5 MT as against the normative requirement of around 5 MT.

"From the estimates for next year's production, it is clear that there will still be a small surplus over the domestic requirement in 2019-20 sugar season, and, therefore, there will be need for India to export sugar in the next year also," the association said.