Despite fall in production, ISMA says no need to import sugar
PUNE: Banking on a higher crop and early crushing in next season and decline in sales in the current season, Indian Sugar Mills Association (ISMA) reiterates that the country does not need to import sugar even though the production could decline to 21.3 lakh tonnes.
Indian Sugar Mills Association (ISMA), in its Committee meeting held on 25th January 2017, reviewed the situation of sugar production for the sugar season 2016-17 SS.
In the last sugar season 2015-16, total despatches by the mills were at 248.5 lakh tonnes and as per the field reports, it is certain that current 2016-17 SS will be lower than that of last season.
The sales in January 2017 also seems to be lower as compared to last year, when sugar mills had sold 25 lakh tonnes. Assuming that in the balance 8 months of the current season i.e. from February to September 2017, there is similar sugar sales in comparison to last year and assuming that the sugar sales/despatches are similar to last year, the sugar sales in the current season upto September 2017, will be around 242 lakh tonnes.
The opening stocks of sugar as on October 1, 2016 for the current sugar season, was 77.5 lakh tonnes. These figures have been collected from reports and statements submitted by each sugar mill to the Government, as per physical stocks in their godowns.
Considering 213 lakh tonne of sugar production as per 2nd advance estimates of ISMA, sugar despatches of 242 lac tons in the whole 2016-17 SS and a high opening balance of 77.5 lac tons for the season, the closing stock of sugar as on September 30, 2017 will be 48.5 lakh tonnes.
48.5 lakh tonnes of closing balance is equivalent to at least 2½ months of sugar consumption. This year, 37.3 lakh tonnes of sugar was despatched by sugar mills in October – November 2016, whereas 39.8 lakh tonnes was despatched in the previous i.e. 2015-16 SS in October – November 2015.
Therefore, the sugar requirement in the 2 months of sugar season is generally expected to be around 37 to 40 lakh tonnes. Since the sugar mills have the freedom to sell sugar as and when produced by them, new season’s sugar is now available in full swing from end of October.
Further, as per field reports, sugarcane sowing reported from Maharashtra and Karnataka is significantly higher as compared to the same period last year. With abundant water availability in the reservoirs as per reports collected from Government’s website of Central Water Commission, it is expected that sugar production in Maharashtra and Karnataka in the next season should be back to normal. “Therefore, there will be surplus sugar production as compared to domestic requirement in 2017-18 SS,” t ..
In the current sugar season, 2016-17 SS, 28 lakh tonnes of sugar was produced in October – November 2016.
“There are reasons to believe that the sugar mills will be starting sugar production from end of October 2017 in most parts of the country, including in U.P and Maharashtra. Generally, sugar mills start latest immediately after Diwali, when labour is available for harvesting. Diwali this year is on 19th October. Also because of surplus sugarcane production next season, mills will start early. Therefore, new season’s sugar should be available from the end of October 2017,” stated the ISMA release ..
Therefore, old sugar equivalent to even 45 to 60 days is more than sufficient to cover the period before the new season’s sugar comes into the market, which as suggested above, would be from the end of October 2017.
Thus ISMA says, there is no need to import sugar. “Therefore, as per the above estimates and calculations, there is no reason to feel that there is any shortage of sugar in the country or there is need to import any sugar. ISMA is strongly against any speculation and does not believe in unnecessary spike in sugar prices due to such speculative tendencies on the part of few vested interests,” stated t ..
Source: ECONOMIC TIMES