PUNE: The Indian Sugar Mills Association(ISMA) has projected sufficient availability of sugar in the domestic market despite fears of a 30% drop in sugar production in Maharashtra during the 2012-13 crushing season. The loss will be set off by enhanced sugar production by Uttar Pradesh, another key sugar state in the country. As such, domestic sugar price is unlikely to be impacted, the ISMA has said.

Already, the international sugar market is sluggish and most of the sugar produced in the country is expected to go to the domestic market, which will ensure stability of price.

Maharashtra is expected to produce 60 lakh metric tonne (MT) sugar this year as against 90 lakh MT last year. The state consumes around 20 lakh MT sugar while the remaining goes to other states.

The ISMA and the National Federation of Cooperative Sugar Factories (NFCSF) have released a joint report on sugarcane and sugar availability in the country. It has mentioned that thesatellite images procured during August this year show that the sugarcane acreage for 2012-13 is around 53.54 lakh hectares, which is about 2% higher than 2011-12. Actual sugar production in the country will be 262 lakh MT against the industry estimation of 260 lakh tonnes in the coming crushing season.

The estimated domestic consumption of sugar is close to 220 lakh tonnes, which means there will be 40 lakh tonne surplus sugar in the country, the report stated. The ISMA-NFCSF will come up with their next satellite mapping report on harvestable cane crushed and balance left for crushing, by December or January.

Speaking to TOI, Sanjeev Babar, managing director, Maharashtra State Federation of Cooperative Sugar Factories Ltd, said, "As many as 20 out of the 119 cooperative sugar factories from the state may not function during the season this year. The state also has 51 private factories, which are yet to take a call on whether to go for cane crushing this season. The cost of production will be high but the prices will not be hampered as the recovery rate i.e. percentage of sugar yield from per MT of sugarcane crushed in Maharashtra and Gujarat is 11.5% as compared to 9.5% of Tamil Nadu and Karnataka."

Explaining the profit hampering on the sugar industry, Babar said, "Due to factories running under capacity, the cost of production will be more, however, the profit margin depends on a number of factors like labourers, raw materials, government grievances, transport and the impact of national and international market. Hence, it is difficult to calculate."

D G Hapse, sugarcane expert, said, "It is a big loss for sugar producing factories. Sugar producing factories in regions of Ahmednagar, Nashik, Vidharbha, Satara, Solapur and Sangli will be affected more. Only about 130 factories may function in the state against 160 last year. Some factories might even stop functioning before the end of the seas.