Sugar Output Likely To Fall By 10-15%

As the impasse between the government and millers continued in Uttar Pradesh, analysts said India’s sugar output in 2013-14 could drop 10-15 per cent on a year ago if crushing did not start in 15 days. In Maharashtra and Karnataka, too, crushing has not started, as the farmers are demanding a higher cane price.



However, it might not have any impact on prices or supplies as the opening stock of sugar, nine million tonnes, is much more than required, said the chairman of the Commission for Agricultural Costs and Prices, Ashok Gulati. “We have excess stock and a 10-15 per cent cut in production would bring the market to equilibrium.” “The more the cane stands in the field, there is a possibility of production getting impacted, as the sucrose in those would go down,” an expert said.



Indian Sugar Mills Association on Friday said till November, 0.80 million tonnes of sugar was produced in the country, 67 per cent less than last year, as 208 of India’s 400-odd sugar mills started crushing. On Thursday, Food Minister K V Thomas said there was no impact on production, but conceded output could fall if the impasse continued and the farmers did not bring the cane to the mills. He said production in the 2013-14 crop marketing year (October-Sept-ember) was expected to be 24.4 mt, 2.7 per cent less a year ago.



However, this drop is due to drought in Maharashtra and Gujarat last year and not because of the current logjam between millers and sugarcane growers.



India’s sugar production in 2013-14 is estimated at 24.4 million tonnes, while demand is estimated at 23.5 million tonnes. “The difference between demand and supply of sugar is expected to be around 0.85-0.90 million tonnes,” Thomas said. He said the old five-year cycle of excess and deficient production in sugar is over.



The impasse of sugarcane pricing has impacted crushing with as more than 70 of the 99-odd private mills in Uttar Pradesh have suspended their operation. The crushing had to start from middle of November.

Source:- business-standard.com