India sugar stocks set to fall to 4-year low on record exports: ISMA

India’s sugar inventories have fallen by 19 per cent and the country would start the 2021/22 marketing year with lowest stocks in four years. Sugar mills this year exported a record amount according to Indian Sugar Mills Association (ISMA). India is set to export a record 7 million tonnes of sugar in the current season, nearly 18% more than a year ago, it said.

India could start 2021/22 marketing year on 1 October with carry forward stock of 8.7 million tonnes, down from 10.7 million tonnes a year ago, ISMA said in a statement. The country could produce 31 million tonnes of sugar in 2021/22 compared with 30.9 million tonnes in the current season, the trade body said.

The area under sugarcane has risen by around 3 per cent to 5.46 million hectares and the weather is also conducive, but additional cane supply is likely to get diverted for ethanol production. “With higher ethanol production capacity and continued surplus sugarcane in next year, approximately 3.4 million tonnes of sugar will be diverted into ethanol next season,” it said.

India plans to achieve 20% ethanol-blending with gasoline by 2025 to reduce its dependence on costly oil imports and slash excessive sugar production. In December, India approved a subsidy to encourage cash-strapped mills to export 6 million tonnes of sugar in the 2020/21 marketing year ending on Sept. 30. A few mills exported sugar without subsidy as they needed funds to make cane payments to farmers, industry officials said.

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