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New Delhi, September 13 (Commodities Control):Maharashtra, the forefront sugar-producing state in India, is bracing for a significant downturn in its sugar output. Reports from industry and government sources indicate an expected 14% dip in the 2023/24 crop year, presenting the lowest production figures in the last four years. This sharp decrease is attributed to the state enduring its driest August in over a century.
This slump in sugar production has potential repercussions, including a spike in food inflation. With the situation as it stands, the central government might reconsider its stance on sugar exports, potentially impacting already soaring global sugar prices.
On the domestic front, prominent producers like Balrampur Chini, Dwarikesh Sugar, Shree Renuka Sugars, and Dalmia Bharat Sugar stand to benefit. The rise in domestic sugar prices could enable these firms to honor their financial commitments to farmers more promptly.
Further shedding light on the situation, an official from the West Indian Sugar Mills Association mentioned, "The sugar cane crop's growth has been severely stunted due to insufficient rainfall during its key growth stage, with most districts being adversely affected."
The state, known for its influential role in the global sugar market, experienced a substantial 59% shortfall in August's rainfall. Post a recent review with representatives of various sugar mills, Maharashtra's sugar commissioner emphasized the pressing need for significant September rains to alleviate the ongoing crop distress.
Recent predictions from the state-run weather department are moderately optimistic, forecasting average rainfall for September. However, given the backdrop of a historically dry August, many remain cautious.
The ripple effect of Maharashtra's production drop is anticipated to be vast, especially concerning India's stance in the global export market. Past data highlights Maharashtra's stellar production of 13.7 million tons in 2021/22, which aided New Delhi in exporting a commendable 11.2 million tons. But with the subsequent dip to 10.5 million tons in 2022/23, exports were constrained to 6.1 million tons.
There's growing speculation about the central government potentially imposing a ban on sugar exports in the approaching season. If this comes to pass, it would be the first such pause in export activities in seven years.
(By CommoditiesControl Bureau; +91-9820130172)
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