Domestic sugar production in the first two and a half months of this season that began on October 1 is higher compared with the same period a year ago.

According to the Indian Sugar Mills Association, production till December 15 was 42.35 lakh tonnes (lt), some 13.5 lt more than the same period a year ago. Mills produced 23.28 lt mills since the beginning of this month against 17.37 lt in the last season.

Some 442 sugar mills have begun crushing operations this season compared with 426 last season.

Crushing gained momentum this month with almost 100 mills beginning operations. As of November 30, 344 mills had started operations. “The main reason (for higher production) is that this year, higher numbers of sugar factories are already crushing sugarcane,” read an ISMA statement.

Around 166 mills had started crushing cane in Maharashtra, the country’s largest sugar producing State. In Uttar Pradesh (UP), 114 mills had started production while Karnataka recorded 53 mills. In terms of production, Maharashtra recorded an output of 20.73 lt as of December 15 while UP and Karnataka registered 7.94 lt and 7 lt, respectively.

The figures for all three States are higher than at the corresponding stage last season. Other States have produced a combined 6.58 lt of sugar so far, up from 5.24 lt in 2013-14. Ex-mill prices have been falling daily between ₹10 and ₹40/quintal, ISMA said.

“The current ex-mill prices are at its lowest in the last 3 years and around ₹500-700 below cost of production,” the statement said.

The association feared that stagnant sugar prices could result in cane arrears getting accumulated with sugarcane prices higher than last season. The Government is in the process of examining an extension of the export incentive scheme for raw sugar that it had announced in February subject to mills clearing current arrears.

Domestic consumption is pegged at 247 lt and India is estimated to produce between 250 and 255 lt in the 2014-15 season.

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