Ex-mill sugar prices in Maharashtra and Karnataka have been falling continuously
Sugar production in the current 2014-15 sugar season (October-September) till 31 December 2014, is 74.61 lakh tonnes. Last year during the corresponding period, it was 58.63 lakh tonnes. Thus, 15.98 lakh tonnes or 27.3% more sugar has been produced more this year till 31 December.As on 31 December 2014, 481 sugar mills were in operation in the country as against 485 sugar mills operated last year same period. 499 sugar mills were operating as on 31 December 2012 when the sugar production was 80.32 lakh tonnes.
In U.P., 117 sugar mills were in operation on 31 December 2014, as against 119 last year on 31 December. 17.21 lakh tonnes of sugar has been produced upto 31 December 2014, as compared to 11.19 lakh tonnes produced last year same period. In 2012-13, the sugar production upto 31 December was higher at 19.03 lakh tonnes. This year's production is slightly higher than last year mainly because the U.P. mills started their crushing operations almost a week before last year. Sugar Recovery % till 31 December 2014 is higher at 9.25%, which was 8.75% last year.
In Maharashtra, 171 sugar mills have produced 32.75 lakh tonnes of sugar till 31 December 2014. This is 10.41 lakh tonnes more than last year during the corresponding period when 155 sugar mills were under operation. In 2012-13 sugar season, 158 sugar mills were in operation in Maharashtra and they had produced 28.65 lakh tonnes till 31 December.
In Karnataka, 63 sugar mills are in operation and they produced 12 lakh tonnes of sugar upto 31 December 2014. Last year same period, 59 mills were in operation who produced 12.34 lakh tonnes of sugar till 31 December.
In Tamil Nadu, only 15 sugar mills had started their crushing operations till 31 December 2014 as against 35 sugar mills, which were in operation on 31 December in 2013-14 sugar season. Upto 31 December 2014, sugar production in the State was 0.65 lakh tonnes as compared to 1.62 lakh tonnes produced last year in the corresponding period.
In Bihar, all 11 sugar mills which are in operation produced 1.80 lakh tonnes of sugar upto 31 December 2014 which is 0.90 lakh tonnes more than what they produced last year same period.
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In other States, sugar production remained more or less same as that of last year.
Ex-mill sugar prices in Maharashtra and Karnataka have been falling continuously and at present sugar mills are selling their sugar at Rs 2450-2500 per quintal. Ex-mill prices in U.P. are now ruling between Rs. 2600-2650 per quintal.
It has become difficult for the mills to even pay FRP within the stipulated period as ex-mill sugar prices across the country are substantially below the cost of production.
The industry continues to eagerly wait for the Central Government's announcement on continuation of incentive scheme on raw sugar production and exports thereof that will help improve liquidity with the industry and check the continuously falling ex-mill sugar prices, which in turn, should improve the industry's cane price paying capacity.
The OMCs have invited Expression of Interest (EoI) for 97 crore litres of ethanol at fixed price, as approved by the Government on 10 December 2014, which is to be opened on 12 January 2015.
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