New Delhi, Nov 20 (UNI) Early start of crushing has resulted in higher sugar production upto November 15 as compared to same time last year.
As per Indian Sugar Mills Association (ISMA), 13.73 lakh tonnes of sugar has been produced in the first 45 days of the current season as compared to 7.67 lakh tonnes in the first 45 days of last year. The main contributors to the higher production of sugar are the sugar mills in UP and the sugar mills in Maharashtra. According to a ISMA press release, Uttar Pradesh sugar mills have produced 5.67 lakh tonnes of sugar upto November 15 as against 1.93 lakh tonnes produced last year. A total 78 sugar mills were crushing sugarcane as on November 15 as against 55 sugar mills last year same time. Similarly, in Maharashtra as against 95 sugar mills which were crushing sugarcane last year as on November 15, when 1.92 lakh tonnes of sugar was produced, 137 sugar mills were crushing sugarcane this year on 15th November and 3.26 lakh tonnes have already been produced. The third largest sugar producer, namely, Karnataka has produced almost the same quantity as they produced last year. The situation in the other States is almost similar to last year. The ex-mill sugar prices which were almost flat from March 2017 to September 2017 when the all India average ex-mill sugar prices were around Rs 3,600 per quintal, has seen a fall of Rs 100-200 per quintal in various parts of the country. The fall is mostly reported for the last year’s sugar, which is generally sold at a discount whenever the new season’s sugar comes into the market. The Government has extended the stock holding limit on traders by 2 months upto 31st December 2017, as compared to 6 months which was done in the last three occasions since April 2016. Instead of witnessing an increase in sugar sales in the festival months of September and October 2017, one has seen that the poor offtake from the sugar mills has resulted in marginally lower sales of around 41 lakh tonnes, as compared to about 42 lakh tonnes of sugar sales in the same two months last year. With higher production in 2017-18 sugar seasons (SS), the sugar sales need to improve to ensure better cash flows and a stable sugar prices. Now that the current season is moving into a balanced to surplus sugar production year in 2017-18 SS, ISMA has requested the Government to withdraw the stock holding limits on sugar traders with immediate effect. It has been submitted that with surplus sugar availability and lower sugar offtake than expected, continuance of stock holding limit on traders at this stage is affecting their buying interests. This will affect cash flows, which may prove detrimental to the interests of sugar producers and very soon may impact their paying capacity to the sugarcane farmers.