India’s sugar production likely to fall by 18 lakh tonnes, scope for exports are low
India’s sugar production is estimated to drop by 18 lakh tonnes to 325 lakh tonnes during the 2024-25 season, primarily due to a weak sugarcane crop and low recovery in Maharashtra. Uttar Pradesh is expected to lead production, though its crop is also not strong. With reduced production and increased ethanol use, net sugar output will be 285 lakh tonnes. Domestic stocks are sufficient for consumption, but no sugar exports are expected as the government maintains export restrictions.
During the current crushing season (October 2024 to September 2025), which started on October 1, the total sugar production in the country is estimated to decrease by 18 lakh tonnes to 325 lakh tonnes compared to the previous season. Due to a weak sugarcane crop and low recovery in Maharashtra, Uttar Pradesh is likely to have the highest production this year. However, the sugarcane crop in Uttar Pradesh is also not very good this year, and this may lead to a reduction in the duration of the crushing season.
For the current crushing season, the Central Government has set the Fair and Remunerative Price (FRP) of sugarcane at Rs 340 per quintal, based on a 10.25 percent sugar recovery. According to sources from the sugar industry, sugarcane crushing in the mills of Maharashtra will begin on November 15, while it will start in Uttar Pradesh in the first week of November. Due to the poor sugarcane crop in Maharashtra, the crushing season may last for 115-120 days, whereas, under normal circumstances, it lasts for around 180 days. The poor crop and shortened crushing season are not favourable for the economic health of sugar mills. Higher crushing capacity of sugar mills is also a major factor contributing to the shortening of the crushing season.
Total sugar production estimated at 325 lakh tonnes
Last year, a total of 343 lakh tonnes of sugar was produced in the country, out of which 24 lakh tonnes were used for ethanol production. This year, according to industry estimates, total sugar production will be 325 lakh tonnes, with 40 lakh tonnes expected to be used for ethanol production. As a result, net sugar production, will be 285 lakh tonnes, compared to 319 lakh tonnes in the previous season.
Last year, total sugar availability was 376.23 lakh tonnes, including a carryover stock of 57.23 lakh tonnes. At the start of the current season, the carryover stock was 80.23 lakh tonnes, bringing the total sugar availability to 365.23 lakh tonnes. With annual consumption estimated at 295 lakh tonnes, it is projected that closing stock of sugar at the end of season on 30 September, 2025 will be 55.23 lakh tonnes.. Normally, the country should maintain a stock of sugar equal to three months’ consumption, which amounts to around 74 lakh tonnes. Therefore, there is no possibility of sugar exports from the country.
No scope for sugar exports
According to industry sources, there is no possibility of sugar exports under the current situation. The government has placed sugar exports on the restricted list. Sugar exports were not allowed last season due to the non-release of the sugar export quota. Given the current production and stock estimates, it is likely that the government will continue it on restricted list even after October 31, 2024, as the likelihood of exports is minimal.
At present, the free on board (FOB) price of sugar exported from India in the international market is Rs 4,540 per quintal for white sugar and Rs 4,315 per quintal for raw sugar. In the domestic market, the price of M-grade sugar in Uttar Pradesh is Rs 3,915 per quintal, while in Tamil Nadu it is Rs 3,850 per quintal. The price of S-grade sugar in Maharashtra and Karnataka is Rs 3,600 per quintal.
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