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Sugar prodcution in India drops as of April this year compared to same period last year

Sugar prodcution in India drops as of April this year compared to same period last year

| @indiablooms | 16 Apr 2020, 10:45 am

New Delhi/IBNS: Sugar mills across India have produced 247.80 lakh tonnes of sugar as of April 15, 2020, which is nearly  64 lakh tonne less compared to 311.75 lakh tonnes produced at the same time last year, according to a press release by Indian Sugar Mills Association (ISMA), a group consisting of stakeholders of the country's sugar industry.

The release also said that 139 sugar mills were in operation as of April 1, 2020, compared to compared to 172 sugar mills that were crushing sugarcane as of April 15, 2019.

The state-wide comparable (April 15, 2020 versus April 15, 2019) production figures as mentioned by ISMA --

In Uttar Pradesh, sugar mills produced 108.25 lakh tonne of sugar compared to 105.55  lakh tonne. 

Out of 119 sugar mills, 98 were in operation this year compared to 103 mills that were in operation last year on the same date.

The release also said that with several gur /khandsari manufacturing units in UP shutting their operations, it has likely  increased the cane availability for sugar mills for crushing in the current season by a few lakh tonnes of sugarcane.

In Maharashtra, according to the release, sugar production amounted to 60.12lakh tonne, compared with 106.71 lakh tonne produced last year same period, which is almost 46.6 lakh tonne less than last year.

In the current 2019-20 Sugar Season (SS), 136 mills have already closed their crushing operations and only 10 sugar mills are operating.

However, in the corresponding date last season,  six mills were in operation in the state, which added 0.49 lakh tonne of sugar production last year.

In case of Karnataka, till April 15, 2020, 63 sugar mills produced 33.82 lakh tonne of sugar whereas 67 mills produced 43.20 lakh tonne sugar in the same period last year.

All the mills have closed their operations in the state, the release said.

According to the ISMA release, sugar sales/despatches in the country got affected due to the country-wide lockdown and consequent closure of restaurants, malls, movie halls, etc., which in turn has impacted the demand for sugar sweetened products like ice cream, beverages, juices, confectionaries, sweets etc.

The sugar industry, according to the release, expects that the domestic pipeline, which usually holds 10-15 lakh tonne of sugar, has dried up during the lockdown, when sugar in the pipeline got used up.

Hence, as soon as the lockdown is lifted, there can be an increase in sugar demand, especially from the bulk consumers when their operations resume.

The release also mentioned that exports have been affected due to sudden drop in global sugar prices, but the recent depreciation of rupee gave some relief to exporters.

With fresh reallocations being made by the Union Ministry of Food in April, 2020, of the Maximum Admissible Export Quota (MAEQ) from the mills who are not exporting, to mills which still want to export, more sugar will thereafter be on offer for exports.

According to the ISMA release, the drop in sugar supply from Indonesia's major supplier Thailand, India has an opportunity to fill in the gap in the Indonesia market.

Indonesia has already opened up its market for Indian sugar, including offering preferential lower import duty to India (along with Thailand and Australia),

The export to Indonesia is likely to offset India's overall decline in sugar export owing to the Coid-19 pandemic. 

The recent release also mentioned that there were some initial problems in ethanol offtake in the initial period of the lockdown, especially when several depots of OMCs were unable to take further ethanol supplies because of drop in petrol consumption.

However, with some fast response from the OMCs, ethanol supplies have been shifted to other states and depots, where there were hardly or nil any supplies therein.

So ethanol has now started going to newer depots in Jharkhand, Bengal, Madhya Pradesh, Chattisgarh, Rajasthan, Gujarat, AP, Telangana and Kerala.

Efforts are being explored to see if ethanol can be sent to Odisha and Assam too.

Many sugar companies decided to make hand sanitizers to supply to hospitals etc. by using a part of the ethanol/ENA production, according to the release.

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