Sugar output up 11% till December 15; sale hit due to demonetisation

NEW DELHI: Sugar production in the country rose by 11 per cent to 53.29 lakh tonnes till December 15 in the 2016-17 season that started from October, but sales were down owing to demonetisation, industry body ISMA said today.

Sugar output stood at 47.93 lakh tonnes in the same period last year, it said in a statement.

The government has pegged the sugar output at 225.21 lakh tonnes for 2016-17 season (October-September).

As per the latest data released by the Indian Sugar Mills Association (ISMA), as many as 440 sugar mills were crushing cane till December 15 in the current season.

There was 11 per cent increase in the overall output in the said period on account of Uttar Pradesh and Karnataka, while the production in Maharashtra and other states remained lower, ISMA said.

Uttar Pradesh, the second biggest sugar producer, produced 17.66 lakh tonnes of the sweetener as against 8.52 lakh tonnes in the same period last year.

Karnataka mills produced 11 lakh tonnes as against 10.29 lakh tonnes, while Tamil Nadu 75,000 tonnes as against 60,000 tonnes in the said period.

In Maharasthra, the leading sugar producing states, the output was lower at 17.25 lakh tonnes in the first two and half months of the current season, when compared with 22.50 lakh tonnes in the same period corresponding year.

The output in Gujarat too was lower at 2.40 lakh tonnes as against 3.32 lakh tonnes, while Andhra Pradesh and Tamil Nadu produced 1,00,000 tonnes, slightly higher than the year-ago period.

On impact of demonetisation on sugar sales, ISMA said, "Sugar despatches from mills have been affected due to fall in sugar demand from bulk consumers including sweet makers mainly because of shortage of currency in the market."

Though sugar sales in November was almost at the year-ago level, market sources suggest that sugar sales in the first fortnight of December have been "badly affected" and that depressed demand may continue till January 2017, it said.

Total sugar sales in the 2016-17 season could remain on a lower level of 245 to 250 lakh tons, it said.

ISMA also said that there would be significant drop in jaggery production major states like UP. "This could give extra sugarcane for sugar production resulting in a little more of sugar availability at the cost of gur production."