Sugar production in the country dipped 5.4 per cent to 31.1 million tonnes (mt) as of April 15 in 2022-23 sugar season (October-September) against 32.87 mt in the year-ago period, according to Indian Sugar Mills Association (ISMA), an industry body of private sugar companies.
As many as 400 mills have closed their operation and only 132 factories are still continuing the crushing as on April 15, against 305 operational factories in the year-ago period. Experts said that sugar production in next few weeks is unlikely to see any improvement, potentially widening the fall in overall output in the country.
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ISMA is scheduled to assess the production in its next committee meeting next week, as there will be a fair idea on the likely production this year. The industry body has estimated current year output at 34 mt (excluding quantity diverted towards ethanol) while the country had produced 35.76 mt in 2021-22 season. Annual domestic consumption is pegged at 27.5 mt.
Crushing is over in Maharashtra, Bihar, Odisha and Rajasthan while only two mills are in operation in Karnataka and 77 mills in Uttar Pradesh are yet to close their plants. Only mills in Tamil Nadu and some factories in UP are expected to continue crushing next month while in other States crushing may end by this month.
UP output up
The output in Uttar Pradesh was higher at 9.66 mt against 9.44 mt while it dropped in Maharashtra to 10.5 mt from 12.65 mt and in Karnataka to 5.53 mt from 5.8 mt. Maharashtra, UP and Karnataka are top three sugar producers in the country.
Tamil Nadu has seen 28 mills still in operation, the same number as in the year-ago period, and the production was up by nearly 34 per cent to 1.03 mt from 0.77 mt.
Though ISMA has not shared ethanol production data, the pan-India diversion (in terms of sugar) towards production of ethanol which was over 22 per cent up at 3.11 mt until March 15, has narrowed down to about 8 per cent, sources said.
According to a report by Centrum Broking, which has estimated sugar output at 32.5 mt for the whole season, prices of the sweetener are likely to increase in the coming months due to the expected surge in demand during the summer season. It said that after remaining in the range of ₹34.50‐35/kg for several weeks, ex-mill prices in UP have already reached ₹37/kg.