Indian Sugar Mills to Close Early Due to Impending Rain Affecting Cane Supply
- 30-Jan-2023 11:02 AM
- Journalist: Jacob Kutchner
MUMBAI (INDIA): Sugar production in India's top sugar-producing state Maharashtra is set to be significantly lower this year due to a decrease in the availability of sugar cane because of heavy rains. This could mean that the mills will stop crushing cane 45 to 60 days earlier than last year.
According to Shekhar Gaikwad, the Sugar Commissioner for Maharashtra, production for the 2022/23 marketing year that began on October 1st is now estimated at 12.8 million tonnes; down from an earlier forecast of 13.8 million tonnes.
This reduced output could mean that additional exports by India, currently the world's second-largest exporter of sugar, may no longer be possible.
India has given the green light for sugar mills to export up to 6.1 million tonnes of their product in the current season, with 5.7 million already contracted for export.
"Excessive rainfall curtailed sugar cane's vegetative growth. This year lower cane is available for crushing," Gaikwad said.
The sugar mills in Maharashtra have been operating against the odds, despite a record crop, until mid-June 2021/22 to harvest it. Yet, according to a recent report, these mills could start winding down operations within the next 15 days and by the end of April, all but three or four of them are expected to cease crushing operations.
Despite this potential decline in production and processing, Maharashtra still managed to surprise the global sugar market with its wide swings in output this year. Its total production for 2021/22 stands at 6.76 million tonnes - slightly higher than last year's 6.67 million mark.
Sugar production in India has seen a record high for 2021/22, with Maharashtra producing 13.7 million tonnes, significantly higher than the initial estimate of 11.2 million tonnes. This allowed New Delhi to export a record 11.2 million tonnes of the sweetener.
However, estimates for this year have sadly been revised down in both Maharashtra and Karnataka and it looks unlikely that India will be able to fulfill the industry's request to export additional sugar up to 4 million tonnes.
The result of this is that the Indian Sugar Mills Association and other trade bodies will not be receiving their desired exports quota.
India is a major exporter of sugar, sending some of its produce to Indonesia, Bangladesh, Malaysia, Sudan, Somalia, and the United Arab Emirates.