Higher recovery aided by good rains to boost India’s sugar output to 35.5 million tonnes

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The USDA’s India Post has raised the forecast for the country’s centrifugal sugar production for marketing year 2024-25, starting October, to 35.5 million tonnes on higher recovery aided by adequate monsoon in key producing States. The projections by the local office are higher than USDA’s estimates of 34.5 million tonnes. The production estimate for 2023-24 has been unchanged at 34 million tonnes.

The estimates of 35.5 million tonnes on raw value basis are equivalent to 33.2 million of crystal sugar, including khandsari. The Indian Sugar Mills and Bio Energy Manufacturers Association has forecast sugar production, before diversion, at 33.31 million tonnes.

USDA India Post’s forecast of higher production is supported by expectations of a good crop due to sufficient rainfall during the 2024 southwest monsoon, and a better than expected sugar recovery rate. The monsoon rainfall is likely to replenish the soil moisture and increase the availability of ground water for irrigation in Maharashtra and Karnataka, the major sugarcane producing States. Uttar Pradesh, the largest producer of sugarcane, also received sufficient rainfall.

Acreage cut a tad

However, the USDA Post has marginally reduced India’s planted area for sugar for the 2024-25 by 1 percent, at 5.4 million hectares. This is a result of farmers’ shift to areca (betel) nut, cotton, paddy (rice), and pulses in Northern Karnataka and some parts of Maharashtra, it observed.

Sugarcane farmers have shifted to other competing crops based on expectations of drought conditions that were experienced in the previous year. Lowering groundwater level is a concern for sugarcane growers. However, Post ascertained that sugarcane production will increase by 1 percent to 418 million tonnes, compared to previous year’s 415.5 million tonnes. The substantial rainfall received in 2024 is likely to increase the sugar recovery rate of the standing crops and mitigate the effect of decreased cane area.

For the year 2024-25, the sugar exports are expected to remain unchanged at 3.7 million tonnes as the Centre continues to maintain export restrictions, the Post said. Sugar consumption for the forecast year is projected to remain steady at 32 million tonnes driven by demand during festival seasons and organised and unorganised catering services.

Also the USDA Post has increased the forecast for India’s 2024-25 ending stock to 13.6 million tonnes due to a good production year and continued export restrictions.