Sugar output may fall by 8%: Pawar

Sugar output in the country, the world's second-largest producer of the sweetener, is likely to fall 8 per cent to around 26 million tonnes in 2007-08 season compared with 28 million tonnes previous year.

"As per industry estimates, sugar production this season is likely to be around 26 million tons," Agriculture Minister Sharad Pawar said on Thursday.

He pointed out that sugarcane yield is expected to be lower as farmers reduced use of fertiliser in the wake of low price of the sweetener after the glut in the last season.

Sugar season runs from October to September. The country produced 28.3 Million tonnes of sugar in 2006-07 season that ended in September 2007, resulting in huge carryover stocks and a consequent fall in prices.

Indian Sugar Mills Association, the apex body of the industry, had last month pegged the production estimate at 30-31 million tonnes this season. Exports were forecast at 2.5 million tonnes, majority of which would be raw sugar.

Meanwhile, after raising the sugar export subsidy issue in the World Trade Organisation, Australia has taken up the issue with the Indian government saying the sops distort a competitive global market for the sweetener.

The issue was raised by Australian Trade Minister Simon Crean with Agriculture Minister Sharad Pawar at their meeting here on Thursday.

India, on its part, has informed Australia that the subsidy given to sugar exporters was in compliance with the guidelines of the World Trade Organisation.

"There is the issue about concessions given to the sugar exporters. I have explained (to the Australian Minister) about the background .... And how it fits into the WTO guidelines," Pawar told reporters after his meeting with Crean.

The Union government has been giving subsidy to sugar exporters at the rate of Rs 1,350 a tonne for coastal states and Rs 1,450 a tonne for non-coastal states in the backdrop of a glut in the industry.

Besides, Pawar also said the country was eager to export mangoes to Australia from April 2008. "There is some problem from their side. They have assured us that they will look into the matter," he said.

India has started exporting mangoes to the US last year after the ban was lifted. The government is trying to push exports of the fruit in several other countries.