After last year’s drought, the sugar mills are expected to bounce back with 23.6 percent higher production in sugar season (SS) 2017-18. The Indian Sugar Mills Association (ISMA) has anticipated that Indian sugar mills would be producing about 251 lakh tonnes of sugar in the sugar season (SS) 2017-18 which was 203 lakh tonnes in SS 2016-17.
Sugar production till November 30, 2017 in the current sugar season (SS) 2017-18 has reached to 39.51 lakh tonnes. This is about 11.69 lakh tonnes higher than the production in the last season by the same corresponding period when 27.82 lakh tonnes of sugar was produced. As compared to 393 sugar factories which were crushing sugarcane last year on November 30, 2016, 443 sugar mills were crushing sugarcane on November 30, 2017 this year, a report released by ISMA has said.
In Maharashtra, 170 sugar mills have started crushing operations and are running in full swing. As on November 30, 2017, these mills have produced 14.90 lakh tonnes, as compared to 9.42 lakh tonnes produced by 142 mills last year same period, the ISMA report said.
In Uttar Pradesh, 110 sugar mills were crushing sugarcane on November 30, 2017 and have produced 13.59 lakh tonnes till that date. At the end of November, 2016 last year, 103 sugar mills were crushing in Uttar Pradesh who had produced 8.48 lakh tonnes, the report has highlighted.
According to the ISMA report, in Karnataka, 60 sugar mills have crushed 6.82 lakh tonnes of sugar as on November 30, 2017. As compared to this, last year till the end of November, same number of sugar mills almost similar quantity of 6.80 lakh tonnes of sugar.
In Gujarat, 17 sugar mills have produced 1.80 lakh tonnes of sugar by the end of November this year. However, last year at the same date, 19 mills had produced 1.42 lakh tonnes of sugar, ISMA has stated in the report.
According to the report, crushing operations in all the other states have also begun and slowly and slowly the pace of crushing is picking up. The other States have produced 2.40 lakh tonnes in this season upto November 30, 2017, which in the previous season at the same date was 1.7 lakh tonnes.
Sugar season 2017-18 started with an opening balance of around 38.76 lakh tonnes stock which is the lowest ever in the past several years. With an anticipated normal sugar production of about 251 lakh tonnes and imports of about 2.85 lakh tonnes (of whites equivalent), the total availability of sugar in the current season is estimated at 292.61 lakh tonnes. Against this, this year domestic consumption of sugar is estimated at around 250-252 lakh tonnes with a growth of around 2.5%. As such, the closing balance on September 30, 2018, is expected to be about 40-42 lakh tonnes, almost equal to the opening balance of this year, the report has estimated.
The stock holding limit on traders implemented since April 2016 did curtail some of the buying by traders because of which the pipeline has become almost dry. With the Government clearly deciding not to continue with stock holding limit on traders beyond December 31, 2017, there will be buying interests to restock the pipeline, which will give a fillip to the sugar off-take. If however, the Government agrees to withdraw the stock holding limit earlier, the demand will surely improve the market sentiments, according to the report.
ISMA has been traditionally obtaining satellite images of sugarcane crop in June every year and will do so again in June 2018, to get an idea of the acreage under sugarcane. It will carry out detailed analysis of the weather, water availability, and distribution of the crop to estimate the sugarcane yield and sugar recovery and only thereafter make a proper estimation of sugar production in 2018-19 SS.