Mumbai: Sugar production in the country, the world’s second biggest producer, fell 6% in the 10 months to July after farmers in cane-growing states delayed crushing.
Output was 26.1 million tonnes (mt) in the October to July period, compared with 27.9mt a year earlier, said Vinay Kumar, managing director of National Federation of Cooperative Sugar Factories Ltd, in a telephone interview.
Production cut: Villagers ride past a sugar cane field near Hapur, Uttar Pradesh. Sugar mills in the state are not processing the crop because of a price dispute with the government. (Photograph by Amit Bhargava / Bloomberg)
Harvesting of sugar cane in Maharashtra, the nation’s biggest producer of the sweetener, was delayed by two weeks after heavy rains last year and mills in Uttar Pradesh, the second biggest, held back processing the crop because of a price dispute with the state government.
“There’s not much sugar cane left to be crushed and we don’t expect the overall production to go up significantly for the rest of the year,” Kumar said.
Production next year may drop 25% to 20mt as some cane growers switched to more profitable crops such as rice, maize and oilseeds, Kumar said last month. Farmers reduced the area planted to sugar cane 17% to 4.39 million ha as of 1 August, the farm ministry said last week. Rains in Maharashtra were as much as 38% less than the average until 30 July, threatening the survival of the planted crop.
“Sugar cane growing regions have received rain in recent days but that’s not going to help increase the planting area,” Kumar said. “Fears of lower crop production have pushed up local prices and mills are not selling to exporters.”
Mills across the nation have slowed exports in recent weeks after wholesale prices in July rose 16% at Vashi, a Mumbai suburb and the nation’s biggest sugar market. On Tuesday, refined sugar prices reached Rs19,020 a tonne, exceeding levels on London’s Liffe exchange.
Sugar exports from the country may exceed 4mt in the year ending 30 September, with more than 60% of the sweetener in raw form, Kumar said.