Sugar Demand

The production could fall to around 27 million metric tons from the last year's 32 million tons and below annual consumption of more than 29 million tons, said India head of a global trade house

The government wants to make sure there's enough sugar for the local market at reasonable prices, and on using more cane to produce ethanol

E.I.D. Parry India Ltd has reported a consolidated profit after tax for the January-March 2024 quarter at Rs 294.30 crore, the company said. The city-based sugar manufacturer had registered a consolidated PAT at Rs 286.90 crore during the corresponding quarter of last year. Commenting on the financial performance, Managing Director S Suresh said, "the operating performance of the standalone sugar division was lower during the year as compared to the previous year on account of nil exports, higher cane cost, lower recovery from cane and change in product mix in distellery on account of change in Government policy." The overall cane crush marginally reduced during the year from 51.81 LMT metric tonne to 50.09 LMT and sugar sales reduced from 5.20 LMT (lakh metric tonne) to 4.64 LMT, he said. For the financial year ending March 31, 2024 the consolidated profit after tax fell to Rs 1,617.57 crore, from Rs 1,827.74 crore registered a year ago. The consolidated total income during the .

But this year demand is above average as heat waves and election rallies boost consumption of ice-cream and soft drinks, said Avantika Saraogi, executive director at Balrampur Chini Mills

The government on Monday ruled out possibility of allowing sugar exports in the current 2023-24 season ending October, the industry's persistent demand notwithstanding. Currently, there are curbs on export of sugar for an indefinite period. However, Indian Sugar Mills Association (ISMA) has requested the government to allow export of 10 lakh tonne of sugar in the 2023-24 season, anticipating healthy closing stock by the season-end. "As of now, the government is not considering sugar exports although the industry has demanded," a senior food ministry official told PTI. The country's sugar production crossed 30 million tonne till March of the ongoing 2023-24 season. ISMA has revised net sugar production estimate for 2023-24 season to 32 million tonne. The government has estimated sugar output at 31.5-32 million tonne. Meanwhile, the government is considering allowing sugar mills to use excess stock of B-heavy molasses for ethanol production this year.

The country's sugar production dipped 2.48 per cent to 22.36 million tonnes till February 15 of the ongoing 2023-24 marketing year, as per the industry body ISMA's latest data. Sugar production stood at 22.93 million tonnes in the year-ago period. Sugar marketing year runs from October to September. In its second estimate, the Indian Sugar Mills Association (ISMA) has projected sugar output to decline by 10 per cent to 33.05 million tonnes in the current 2023-24 marketing year as against 36.62 million tonnes in the previous year. According to ISMA, sugar production in Maharashtra, Karnataka, Gujarat, and Tamil Nadu remained lower till February 15 of the ongoing marketing year. However, sugar output in Uttar Pradesh -- the country's second largest producer of the sweetener -- was higher at 6.77 million tonnes as against 6.12 million tonnes in the period under review. The production in Maharasthra -- the country's largest producing state of sugar -- was down at 7.94 million tonnes t

4.5 mn farmers in the state are directly dependent on the crop; price raised ahead of national elections

The government has given a final call to all legal entities engaged in sugar trade to declare their stocks on a food ministry website by October 17, and warned that strict action will be taken against those for violation. On September 23, the Food Ministry had issued an order directing all sugar stakeholders -- wholesalers, retailers, big chain retailers and processors -- to weekly update their stock position on its website. The Ministry, however, observed that many of the legal entities dealing with sugar trade/storage have "still not registered" themselves on the sugar stock management system. "Various instances have been reported to the Directorate of Sugar and Vegetable Oils, where many of these legal entities are having possession of a substantial quantity of unreported sugar stocks," the ministry said in a letter written to all stakeholders. There are cases where these entities are not updating their sugar stock on a regular basis, it said, adding this not only violates the .

Analysts expect lower output to keep sugar prices elevated at least for the next year, driving gains for the sector

Lower sugar output from India, the world's biggest producer of the sweetener, will leave hardly any surplus for additional exports during the current 2022/23 season

Sugar mills have entered into contracts to export 55 lacs tons of sweetener so far in current marketing year ending September and out of that, according to industry body ISMA

Mills in India, which vies with Brazil as the world's top sugar producer, have so far contracted to export about 1.2 million tons and aim to ship as much as 8 million tons in the 2022-23 year

Global sugar prices will structurally change as demand from India falls and more volatility is expected in correlation with energy prices, Ricardo Mussa, CEO of Raizen said

India's sugar policies, which include large subsidies, have been questioned for years at the World Trade Organization by competitors including Brazil and Australia.

Most brokerages have a positive stance on India's sugar industry as it appears well poised to benefit from global and domestic factors

Consumption in India has stagnated at 19 kilograms per capita per year compared with a global average of 23 kilograms

Demand has emerged from cold drink and ice creams makers that seek to fill pipeline inventory which got diminished during the lockdown due to factory closure and freight disruptions

With the malls and restaurants being allowed to open under unlock 1.0, the sugar demand will further rise.

The factories were able to supply only a third of OMC requirements in the second tender

Global sugar consumption is expected to climb 1.3 per cent in the 2019-20 season, slightly below the five-year average, the International Sugar Organization said in a report