M'shtra sugar output at 52 lakh tn

Ayear of bumper production and good prices have brought smiles to the faces of sugar barons in Maharashtra.

After a drought of three consecutive years, good rains saw sugar co-operatives in the state produce 52 lakh tonne, which was complemented by a surge in sugar prices globally.

Prices soared last year because of Brazil, the big gun of global sugar markets, shifting focus from sugarcane production to ethanol and a drought in key sugar-producing countries like South Africa and Mauritius.

For the 2006-07 crushing season, which begins in October, sugar production is expected to touch 69 lakh tonne. However, sugar producers are wary of the prospect of Brazil shifting focus back from ethanol to sugar production this year.

"Things can change anytime. If international crude oil prices fall or stagnate in the international market, or if prices of sugar become attractive, Brazil may be tempted to abandon its drive for ethanol production and switch back to sugar," said Prakash Naiknavare, MD, Maharashtra State Co-Operative Sugar Factory Federation.

"The future lies in becoming sugarcane processing units and not the sugar factories," says Naiknavare.

Elaborating this Naiknavare said, "You need to have all the operations like sugar production, ethanol production and co-generation on your premises. And be able to shift from one product to another depending on the market. If sugar is fetching good prices, your main product should be sugar, if ethanol is commanding a good price then you must focus on ethanol."

Union agriculture minister Sharad Pawar has taken the lead in educating sugar-cooperatives in Maharashtra and we expect his efforts to yield results, Naiknavare added.