Best of sugar cycle might be over

Higher output estimates will limit realisation gain, while higher cane prices will push up costs

India’s sugar production is set to rise by 16–20 per cent in the coming sugar year (SY) of 2017-18 (starting October 1 and on till September 30), to 23.5-24.5 million tonnes (mt), estimates rating agency ICRA.

The would be around the demand, of close to 24.5 mt. As production started declining in SY16, and deficit seen in SY17 might reverse now. This means prices could see some pressure, restricting the upside to the realisation of sugar manufacturers.

Stocks of Balrampur Chini, Shree Renuka, EID Parry and Bajaj Hindusthan have also seen some profit-booking from their recent peaks.

Another worry for the