The Indian Sugar Mills Association (ISMA) had estimated last year sugar output in the current season at 23.8 million tonnes. The lobby group’s latest statement shows that actual production was just a whisker short of its estimate. Crushing began late because of a dispute over the procurement price but has caught up quickly with last year’s levels.

Sugar production reached 23.75 million tonnes (mt) on 30 April.

Although the season is drawing to a close, since crushing started late, more mills appear to be open at this point, 80 versus 45 last year. As a result, the final production figure may well exceed the industry association’s initial estimate. Last year’s sugar output was 25.1 mt, and millers were hoping a shortfall in production could lead to a tighter demand-supply situation and better prices.

The latest statement talks about difficulties faced by the industry due to delays in announcement of incentives to export raw sugar for April and May and the slow pace of disbursal of interest-free loans.

Seasonally, prices tend to be soft during this period due to the crushing season. Future sugar prices may be influenced on final sugar output and whether it exceeds estimates and by how much, announcement of raw sugar export incentives for April-May, disbursal of interest-free loans and, if this year’s monsoon is indeed below normal, then the impact it can have on next season’s crop.