India will likely produce surplus sugar for a sixth straight year through 2015-16 despite a marginal drop in output expected for the next marketing year starting October due to erratic monsoon.

According to a preliminary forecast by the Indian Sugar Mills Association (Isma), sugar output in the world’s second-largest producer is expected to touch 28 million tonne in 2015-16, compared with an eight-year high of 28.30 million tonne this year. Consumption is expected to go up to 25.2 million tonne in 2015-16, up from roughly 24.50 million tonne this year.

This means the current glut in the domestic market would continue unless export prospects brighten, which, in any case, looks unlikely without government support, given the depressed prices overseas. The country’s sugar stocks at the end of this season in September is estimated to touch 10.20 million tonne, the highest in the last six sugar seasons. Sugar prices are already at seven-year lows, having dropped below even cane costs.

Isma said the country’s output is expected to drop marginally in 2015-16, as poor monsoon rains in Maharashtra could hurt yield and drag down output by 7.6% year-on-year to 9.7 million tonne. However, output in Uttar Pradesh, the second-largest sugar producer in the country, could rise 3.5% to 7.35 MT.

Isma said area under the cane crop in Uttar Pradesh is estimated at 23.14 lakh hectares, compared with 23.07 lakh hactare in 2014-15. The association is anticipating a better yield in 2015-16, which may increase sugarcane production as well as the availability for crushing by sugar mills.

The association has projected the total cane acreage in the country at 53.58 lakh hectares in 2015-16, which is almost similar to the 2014-15 level when it was 53.23 lakh hectares.

Karnataka could produce 4.98 million tonne in 2015-16, a tad higher than 4.96 million tonne it produced in 2014-15. Sugar production in Tamil Nadu is expected to remain at the same level next year — at around 1.27 million tonne.

Isma said these were preliminary estimates and the association will release its first advance of sugar production for 2015-16 in September, when “the crop will be fully mature with better clarity on monsoon progression too”.