Sugar production in Maharashtra and Karnataka may fall by 4 million tonnes next season starting October as farmers in the two drought-hit states have reduced planting owing to water scarcity, potentially shrinking the country’s total output of the sweetener to 21 million tonnes. Sugar output in Maharashtra may shrink to 5.5 million tonnes in 2016-17 season (October-September) against an estimated 8.38 million tonnes this year, said Sanjeev Babar, managing director of Maharashtra state cooperative sugar factories federation. Similarly, Karnataka is likely to produce 2.8-3.0 million tonnes against 3.8 million tonnes this year, said K Santhakumar, president of Karnataka’s sugarcane growers’ association. If this happens, India’s sugar production may come down to as low as 21 million tonnes next year even if all other states manage to match this year’s level. The output is estimated at 25 million tonnes in 2015-16, according to Indian Sugar Mills Association (ISMA). However, ISMA president Tarun Sawhney said that the output next year could be at least 24 million tonnes. His optimism is based on more production in Uttar Pradesh and Tamil Nadu. “The area under ‘238 variety’ is growing as it doubles the productivity. The acreage under this variety may increase to 60 per cent of total cane area in the state next year as planting has progressed until now,” he said. Asked why UP has produced the same quantity of sugar as last year despite growing this variety, he said the area under 238 was only 25-30 per cent and it offset the yield losses of normal varieties. The normal cane varieties in the state had a yield loss of about 30 per cent, he said. The ISMA chief was also of the view that sugar production might increase substantially in 2017-18 and there would be no need to import sugar for at least the next two years. He asked the government to continue with the 40 per cent import duty on sugar. When the sugar season begins on October 1, domestic sugar mills will have an opening stock of about 7.5 million tonnes and it could be between 4.5 million tonnes and 5 million tonnes in 2017-18, he said. The annual domestic consumption of sugar for 2016-7 is pegged at 26 million tonnes. Commenting on the government’s measures like imposition of stockholding limits to bring down sugar prices, Sawhney said that the price should be allowed to hover around Rs 42 per kg so that mills would be able to sell at Rs 36 a kg. The average ex-mill price of sugar in the north is Rs 31 per kg so far this year, he said. The government, he said, must follow the Rangarajan committee formula to fix the sugarcane price on the basis of sugar price realisation. Sudhir Panwar, planning commission member of Uttar Pradesh, opposed the Rangarajan formula and said that the finished product’s sale price cannot determine the raw material cost and it does not happen in any other agricultural commodity. “How can this be allowed? Rather, the selling price of sugar may be fixed after taking into account the cost of production of sugarcane and the profit farmers require,” Panwar said. He also asked the government to accept the Thorat committee formula of giving 30 per cent weightage to byproducts like molasses and ethanol while determining the cost of production of sugar. He asked sugar mills in the state not to depend on government subsidy as it cannot be provided for long. The Uttar Pradesh government has not raised the sugarcane price for the third year in a row.