Sugar production for 2015-16 estimated at 26 million tonnes

Sugar production in the 2015-16 crop marketing year, started from October, is estimated to be around 26 million tonnes (mt), about two mt less than last year and below earlier projections, a senior government official said.

The drop has been mainly due to extended dry weather in Maharashtra and Karnataka. The expected fall in output, comes days after Indian Sugar Mills Association, lowered its forecast for the 2015-16 crop by one mt.

"Consumption in 2015-16 is estimated to be 25 mt, which also means that overall surplus this year could be around one mt, much less than expected," the official said.

The decision to lower the production estimate was taken after a meeting of state sugarcane commissioners held on Friday. "The input from the states showed that yields in Maharashtra and Karnataka could be impacted due to long dry spells in the sugarcane growing belts," the official said.

Maharashtra is India's largest sugar producing state, while Karnataka is also not far behind.

This year's southwest monsoon has been deficient in parts of Maharashtra and Karnataka, where rainfall has been almost half the normal triggering concerns of a large-scale drought.

The country had produced 28.1 mt of sugar in the 2014-15 marketing year (October-September). India is the world's second biggest sugar producer.

Maharashtra, the country's leading sugar producing state, has projected sugar output to decline to 8.6 mt in the 2015-16 marketing year, compared with 10.51 mt last year.

The likely fall in sugar output in the state is mainly due to significant drop in sugarcane output to 83.6 mt in 2015-16 from 102.2 mt last year due to poor rains, a senior Maharashtra government official said.

Similarly in Karnataka, sugar output is estimated to decline to four mt in 2015-16 marketing year from five mt last year.

Sugarcane cultivation in both Maharashtra and Karnataka is largely rainfed unlike Uttar Pradesh where it is irrigated.

However, in Uttar Pradesh, the country's second-largest sugar producer, sugar production is estimated to be at last year's level at 7.2 mt in 2015-16.

According to sources, the UP government had initially informed the Centre that sugar output might exceed by 0.5 mt this year, but in today's meeting the state government submitted the sugar output for 2015-16 to be at last year's level of 7.2 mt.

"In the meeting, the UP government has been asked to rework their estimate keeping in view of possible high cane production in view of cane cultivation being irrigated unlike other states and use of improved cane varieties by farmers for last few years," the sources added.

As per the Agriculture Ministry's first estimate, the sugarcane production is estimated to decline to 341.43 mt in 2015-16 crop year (July-June), as against 359.3 mt in the last year.

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel