the export target of six million tonnes (mt), sugar mills have entered into contracts for about 7 mt in the current sugar season and over six mt of sugar have already been exported, an official statement said on Thursday.

“Some sugar mills have also signed forward contracts for exports in ensuing sugar season starting October. Export of sugar has helped in maintaining demand-supply balance and stabilising domestic ex-mill prices of sugar,” the statement said.

According to the statement, issued by the Ministry of Consumer Affairs, Food and Public Distribution, sugar mills purchased sugarcane worth ₹91,000 crore in the current season ending September.

In the current sugar season, sugarcane worth a record ₹90,872 crore has been purchased by sugar mills and about ₹81,963 crore cane dues have been paid to farmers. Only ₹8,909 crore cane arrears are pending as on August 16. Increase in export and diversion of sugarcane to ethanol has expedited cane price payments to farmers, the statement said.

Permanent solution

In comparison, sugar mills purchased sugarcane worth ₹75,845 crore in the previous season. To find a permanent solution to deal with the problem of excess sugar, the government is encouraging sugar mills to divert excess sugarcane to ethanol which is blended with petrol. This not only serves as a green fuel but also saves foreign exchange on account of crude oil import. 

The revenue generated from sale of ethanol by mills also helps sugar mills in clearing cane price dues to farmers. In 2018-19 and 2019-20 seasons, about 3.37 lakh tonnes (lt) and 9.26 lt of sugar, respectively, were diverted to ethanol. 

In the current sugar season, over 20 lt is likely to be diverted. In the ensuing sugar season, about 35 lt of sugar is estimated to be diverted, the statement said, adding that this could go up 60 lt by 2024-25.