Sugar production may exceed demand at 25 million tonne (MT) in the 2010-11 crop year starting October on the back of a 20 percentage points increase in sugarcane acreage, the country's largest sugar company Bajaj Hindustan said today.
"Sugar production may touch 25 million tonne in the 2010-11 crop year assuming good monsoon and about 20 per cent jump in acreage of sugarcane," Bajaj Hindusthan President (Investor Relations) Narayan Raman said in a conference call.
The country, which is the world's largest consumer of sugar, had to import the sweetener as output fell below the annual demand of 23 MT during the two consecutive crop years starting 2008-09. The sugar crop year runs from October to September.
Recently, a senior food ministry official had echoed similar views that domestic sugar output might outstrip demand due to an rise in acreage and yields. The official had said sugarcane production was expected to touch 300 MT in the next crop year, against 251 MT in 2009-10 as cane plantation would be higher due to rising prices which had hit record highs in the recent past.
On sugar output in the current year, Raman said, "Sugar production would touch 18.5 MT at the end of the current year."
Bajaj Hindusthan said it has produced about 10 lakh tonne both from cane and raw sugar in the first six months of the current crop year. "We have produced 87.80 lakh quintal sugar from cane and 12.46 lakh quintal sugar was refined from imported raw sugar," Bajaj Hindusthan Chief Financial Officer Manoj Maheshwari said.
At present, the supply-demand situation is in balance. Sugar prices are likely to be around Rs 30 per kg in the next two quarters, the company said.
