India’s sugar production has reached only 210 lakh tonnes as on March 13, 2020, which is nearly 57 lakh tonnes less than the previous season, according to National Federation of Cooperative Sugar Factories Federation (NFCSF).
Of this, sugar mills in Uttar Pradesh have produced nearly 83 lakh tonnes, taking the lead yet again. UP’s sugar production is nearly 2 lakh tonnes more than the the previous season during the same period. In contrast, Maharashtra mills have produced around 55 lakh tonnes, around 43 lakh tonnes less than the previous season at the same time. Similarly, Karnataka has produced 33 lakh tonnes of sugar this season, again 9 lakh tonnes less than the previous year.
Gujarat has produced 8 lakh tonnes of sugar, around 2.5 lakh tonnes less than the previous year’s corresponding period. According to the federation estimates, the country’s production is likely to touch 265 lakh tonnes which includes around 118 lakh tonnes from Uttar Pradesh, 60 lakh tonnes from Maharashtra, 34 lakh tonnes from Karnataka and 9 lakh tonnes from Gujarat.
The opening stock at the start of the season was a record 145 lakh tonnes, of which 40 lakh tonnes is the buffer stock and 50 lakh tonnes for exports, leaving 55-60 lakh tonnes stock at the end of the season.
Karnataka’s sugar season is likely to end in the next few days while Maharashtra mills should complete crushing operations by mid-March due to unavailability of cane.
Although the sugar prices may have dropped down due to the coronavirus scare, the country is likely to meet its export targets for the season, it is estimated.
Global sugar prices crashed, making exports unattractive for Indian mills, as selling in the domestic market is now more profitable. The sharp fall in sugar prices due to drop in crude oil prices will reduce ethanol competitiveness as a results more sugar production estimated in Brazil.
The coronavirus disease (COVID-19) is hampering trading with different countries causing uncertainty in global market. Fund managers are diluting their investment interest in commodities with special reference to sugar.