A Pinch of Sugar? India’s Sugar Production Faces Bitter Decline

As the 2024-25 sugarcane crushing season closed, India's sugar production is expected to dip by 12% to below 27 million metric tons (MMT) compared with 31.8 MMT last year. Lower cane availability and increased diversion for ethanol production are the reasons for the drop. Key producers Maharashtra and Uttar Pradesh have reported significant reductions in production.

Despite lower production, sugar prices remain firm at over ₹40,000 per ton in UP and ₹37,000 in Maharashtra. The firmness in price should aid sector profitability in FY25. Concerns regarding adequacy of domestic supply and export prospects are there as consumption is pegged at 29 MMT.

Experts highlight that while ethanol production helps millers, its balance with sugar production is the path to stability. With the next season's prospects riding on a good monsoon, stakeholders are cautiously optimistic.

 

Source: Business Standard, Economic Times, Outlook Business