Sugar production this season seen at 5-year low
India has raised the Fair and Remunerative Price (FRP) of sugarcane by 4% to ₹355/quintal for the 2025–26 season. Sugar production in 2024–25 is projected to fall 7% to a five-year low of 29.5 million tonnes due to poor rainfall and red rot disease in Uttar Pradesh. Despite this, domestic demand will be met, supported by adequate stocks.
The government earlier in the month had approved a 4% hike in fair and remunerative price (FRP) of sugarcane to be paid to farmers by the mills for the 2025-26 sugar season (October-September) to Rs 355/quintal. (Reuters)
The sugar production by mills, net of ethanol diversion, is projected to fall by 7% on year to a five-year low of 29.5 million tonne (MT) in 2024-25 season (October-September), sugar industry has stated. .
The decline in output is attributed to lower recovery rate because of inadequate monsoon rainfall in 2023, and red-rot diseases reported in parts of Uttar Pradesh which has impacted yield, according to trade and government officials.
However the industry has stated there would be sufficient stocks to meet the demand during next festive months.
According to Indian Sugar and Bio-Energy Manufacturers Association (ISMA), the 2024–25 season is projected to conclude with a sugar production in the range of 26.1-26.2 MT out of which 25.74 MT of sweetener has already been produced.
This excludes 3.3 – 3.4 MT of sugar which would be diverted for the ethanol production in the current season. In 2023-24 season only 2.15 MT of sugar was diverted for bio-fuel production.
Currently with the exception of two mills in Tamil Nadu, out of 534 across key growing states including Uttar Pradesh Maharashtra and Karnataka, crushing has been completed. The special crushing season in Tamil Nadu and Karnataka would commence next month.
“Despite the drop in output there will be sufficient stocks to meet domestic demand,” Deepak Ballani, director general, ISMA, told FE.
The industry has projected the domestic demand of sweetener at 28 MT in the current season while exports of sugar is projected at around 0.9 MT.
Stating that the current sugar season commenced with opening stock of 8 MT on October 1, 2024, Ballani said the closing stock at the end of the current season is expected to be around 5.3 – 5.4 MT, enough to meet consumption of sweetner for the two months (October-November).
Crushing of sugarcane for the new season commences from October 1, sweetener starts arriving in the market within two months.
“This indicates that the country will continue to have sufficient stocks to comfortably meet domestic requirements.”Ballani said.
Benefited by the above normal monsoon rains last year, sugar cane planting for 2025-26 season in the southern region has reportedly shown notable improvement in key producing states such as Maharashtra and Karnataka.
“Crushing season is anticipated to begin as per schedule in October, 2025 ensuring adequate supply position and boost output in 2025-26 season,” Ballani of ISMA had earlier stated.
Meanwhile, industry sources said that so far 0.4 MT of sweetener has been exported in the current season while a contract for 0.3 MT of shipment has been entered.
After restricting the sweetener exports in 2023-24 season, the government in January, 2025 had allowed the exports of one MT of sugar in the ongoing 2024-25 season, after taking into consideration domestic availability and diversion towards ethanol production.
The government earlier in the month had approved a 4% hike in fair and remunerative price (FRP) of sugarcane to be paid to farmers by the mills for the 2025-26 sugar season (October-September) to Rs 355/quintal.
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Source : Financial Express
