The Indian Sugar Mills’ Association (ISMA) has projected a 10% decrease in India’s gross sugar production for the current marketing year, ending in September. The estimate, which excludes any diversion for ethanol, anticipates a decline to 330.5 lakh tonnes. This decrease is attributed to expected lower output in Maharashtra and Karnataka, as per ISMA’s second advance estimates for the 2023-24 marketing year, released on Wednesday.
The industry organization has projected a gross sugar production of approximately 330.5 lakh tonnes in the fiscal year 2023-24, contrasting with the previous year’s figure of 366.2 lakh tonnes. Maharashtra’s projected gross production is expected to decrease from 118.5 lakh tonnes to 99.9 lakh tonnes, and Karnataka may see a decline from 65.8 lakh tonnes to 49.7 lakh tonnes.
In Uttar Pradesh, the gross output is seen increasing marginally to 119.9 lakh tonnes from 118.9 lakh tonnes during the period under review.
“The government has so far allowed sugar diversion of only 17 lakh tonnes for production of ethanol via sugarcane juice/B-heavy molasses for 2023-24. This would mean net sugar production could be around 313.5 lakh tonnes,” ISMA said in a statement.
During the 2022-23 marketing year, net sugar production amounted to 328.2 lakh tonnes, including the diversion of 38 lakh tonnes for ethanol production from sugarcane juice and B-heavy molasses. However, with the government permitting limited diversion for the current year, there is an expected 4.5% decrease in net sugar production.
Continue Exploring: Sugar stocks rally with an 8% boost after India’s revoked ban on sugarcane juice for ethanol production
Considering an opening stock of about 56 lakh tonnes on October 1, 2023, domestic consumption of 285 lakh tonnes and the estimated net production of 313.5 lakh tonnes, ISMA said the closing stocks would be comfortable around 84.5 lakh tonnes as on September 30, 2024.
“We believe that the government may now easily allow around 18 lakh tonnes of additional sugar diversion for production of ethanol in the current ESY (Ethanol Supply Year). Even then, closing stock will be sufficient enough to cater around three months into the next season,” the association said.
Meanwhile, ISMA said 187.2 lakh tonnes of sugar has been produced during the October-January period of 2023-24 marketing year as against around 195 lakh tonnes in the corresponding period of the previous year.