However, this year's sugar production estimate is higher than 27.42 million tonnes achieved in the 2019-20 marketing season. In its first estimate, the Indian Sugar Mills Association (ISMA) had pegged the country's overall sugar output at 31 million tonne for the current season.
Millers are also seeking an increase in the minimum support price from Rs 31 per kg to Rs 38 per kg, and a decision is expected in the next few days.
India’s sugar output estimate has been revised lower by 8 lakh tonnes to 30.2 million tonnes for the ongoing 2020-21 marketing season (October-September), industry body ISMA said on Thursday. The output has been estimated after taking into account a likely diversion of about 2 million tonne of cane juice and B-molasses for ethanol production, it said.
However, this year’s sugar production estimate is higher than 27.42 million tonnes achieved in the 2019-20 marketing season. In its first estimate, the Indian Sugar Mills Association (ISMA) had pegged the country’s overall sugar output at 31 million tonne for the current season.
According to the second advance estimates, the ISMA said, “The country is expected to produce 30.2 million tonne of sugar during 2020-21.”
Sugar production in Uttar Pradesh, the country’s largest sugar-producing state, is projected to be lower at 10.5 million tonnes in the current 2020-21 season, as against 12.63 million tonnes last season.
But the output in Maharashtra, the country’s second-largest sugar producer, is estimated to increase sharply to 10.54 million tonnes from 6.16 million tonnes in the said period, on account of higher cane supplies in view of a 48 per cent increase in sugarcane area this year.
Similarly, output in Karnataka, the country’s third-largest sugar-producing state, is estimated to increase to 4.25 million tonnes this season from 3.49 million tonnes in last season, due to increase in cane area and reportedly better cane yields and better sugar recoveries.
There have not been any major changes in the other sugarcane growing states of the country, which together is estimated to produce 4.93 million tonnes of sugar this season, almost similar to the last season’s level.
According to ISMA, the country is expected to have much lower closing stock at the end of the season at around 8.9 million tonne after taking into account an opening stock of about 10.7 million tonnes on October 1, 2020.
ISMA said the government had announced two important policy decisions to improve liquidity of sugar mills during 2020-21 season, by way of announcement of sugar export programme of 6 million tonnes and upward revision of ethanol prices for this season, which have been welcomed by the industry.
However, the government is yet to announce the implementation of a crucial policy decision, increasing minimum selling price (MSP) of sugar. This will improve the liquidity of the mills enabling them to make timely cane payment to farmers also.
“The ex-mill sugar prices are already under pressure in almost all the states and to ensure that sugar mills are able to pay to farmers on time, there is need to quickly decide on increasing the MSP of sugar,” the industry said.