"The retreating monsoon this year has been good in parts of Maharashtra after two consecutive years of low rains, while in Uttar Pradesh the high-yielding C0-238 variety is expected to cover almost 80 per cent of the planted area, which should itself lead to a significant rise in sugar production," said Prakash Naiknavare, managing director of National Federation of Cooperative Sugar Factories Ltd.
He said that the overall crushing capacity of the sugar sector is also expected to go up significantly as the 80 closed cooperative sugar factories will become operational in the coming months.
Of this, around 40 sugar factories are in Maharashtra, while another 30 are located in UP.
"Though we haven't yet assessed the crop estimate for 2018-19, yet whatever information we have from the market, it does point towards a rise in production in 2018-19," said R P Bhagria, chief executive officer of All India Sugar Trade Association.
In UP, the high-yielding Co-238 variety not only gives a higher per hectare yield but its average sugar recovery is also more than existing varieties. Moreover, the variety is expected to occupy almost 80 per cent of the total planted area, as a result of which the overall sugar production is projected to increase.
UP surpassed Maharashtra to become India's foremost sugar producing state and it is likely to maintain this lead for the next two years. All thanks to the new variety.
The price realised from sugarcane for farmers in 2017-18 is also expected to be better than other crops as the UP government has raised the State Advised Price (SAP) of sugarcane by Rs 10 per quintal for both common variety and early maturing varieties at Rs 315 per quintal and Rs 325 per quintal respectivey.
The Central government too has raised the Fair and Remunerative Price (FRP) of sugarcane for 2017-18 season by Rs 25 per quintal to Rs 255 per quintal, while for the 2018-19 season, it is expected to be increased by another Rs 20 a quintal.
The expected bumper harvest has once again reignited calls for devising plans to ensure the absorption of surplus production. If estimates are correct, then India might have a surplus of almost 4-5 million tonnes of sugar by the end of 2018-19 season.