Sugar production higher by 13%: ISMA data
Moneylife Digital Team 03 April 2012

ISMA says has urged the government to allow a fourth tranche of 1.5 MT sugar export before sugar production from Brazil, the largest producer of sugar, is made available in the international market

The total sugar production in the country, as on 31st March stands at around 23.3 million tonnes (MT), 13% higher compared to previous year where it was 20.4 MT. With 26 MT of total estimated production and domestic consumption of 22 MT, the Indian Sugar Mills Association (ISMA), the apex industry body is demanding additional 1.5 MT of sugar for exports. The government has so far allowed export of 3 MT of sugar.

According to ISMA, with the current trend of sowing all over the country, sugar production in 2012-13 season will be higher than the domestic requirement and the country may continue to remain a net exporter next year, too. A clear estimation of sugar production would be available only after a couple of months.  Therefore, with the surplus sugar production almost certain next year, the country should carry forward the opening stock to next year as low as possible.

The industry body says that the opening balance of 6.8 MT of sugar as on 1st October 2011 has burdened the sugar industry. So the next year's opening balance should not be allowed to cross the mark of 5-5.5 MT as it will put pressure on the balance sheets of the sugar mills and harm the interests of sugarcane farmers.

ISMA says that the government should allow a fourth tranche of 1.5 MT sugar export before sugar production from Brazil, which is the largest producer of sugar, is made available in the international market.

Due to piling inventory of 18 MT, the cane arrears are growing. Abinash Verma, director-general, ISMA said that, "The total cane arrears of the sugar mills across the country is about Rs9,900 crore as the crushing season is coming to an end. In Uttar Pradesh, the ex-mill rate is around Rs28.5-RS29 per kg, while the production cost is Rs34. Mills are clearly making losses."

Uttar Pradesh has produced has produced 6.63 MT, Maharashtra has 8.01 MT  and Karnataka, India's third largest sugar producing state, has 3.5 MT, till 31st March.

Comments
abhijit
1 decade ago
North and South Indian Sugar Mills always get benefit of Rs 200/- per quintal in domestic Market than maharashtra and Karnataka sugar mills. If Govt. adopt quota system for sugar Export OGL-6, then Govt. should give same time period for filing application to both option (a) and Option (b), or give time period for option (b) 30days and for option (a) 45 days that will be benefited to Sugar Mills which are interested in physical delivery of Sugar.
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