Domestic sugar production expected to decline by 15 percent
India’s sugar production is set to decline by 15% in 2024-25, dropping to 272.70 lakh tonnes due to low yields and early mill closures. Maharashtra and Karnataka face supply shortages, impacting recovery rates. Despite this, India approved 10 lakh tonnes of sugar exports, likely supporting prices amid rising domestic demand and limited supply until September 2025.
iGrain India – The expected 15% decline in domestic sugar production due to low sugarcane yields and early closure of mills in India will likely have significant market implications.
The Indian Sugar and Bio Energy Manufacturers Association (ISMA) anticipates a drop in production from 320 lakh tonnes in the 2023-24 season to 272.70 lakh tonnes in 2024-25.
This decline is attributed to reduced sugarcane supply in key producing states like Maharashtra and Karnataka, as well as a lower recovery rate of sugar.
Notably, many sugar mills have closed ahead of schedule due to the sugarcane shortage, with more likely to follow, making this the lowest production level in five years.
Despite this, the Indian government allowed the export of 10 lakh tonnes of sugar starting January 2025.
This move is expected to support sugar prices and help sugar mills meet their payment obligations to sugarcane farmers.
With this export policy in place until September 2025, the market is expected to see higher prices, as the supply situation is unlikely to ease soon, and domestic demand is set to increase in the coming months.
The government’s intervention could stabilize the industry to some extent, but overall, prices are unlikely to decrease in the short term given the reduced production and rising consumption.
To read more about Sugar Industry continue reading Agriinsite.com
Source : Investing.com
