COMMODITY
Isma urges govt to allow 20 lakh tonnes of sugar exports in current marketing year
May-07-2024

Sugar industry body -- Indian Sugar and Bio-Energy Manufacturers Association (Isma) has urged the government to allow 20 lakh tonnes of sugar exports in the current marketing year ending September. This would not only ensure sufficient stocks for domestic consumption and the Ethanol Blending Program (EBP) but also improve the financial liquidity of sugar mills and enable timely payments to farmers. For the current 2023-24 marketing year (October- September), the government has not allowed sugar exports to boost domestic supply and control retail prices. In the preceding marketing year, sugar mills were allowed to export around 60 lakh tonnes of sugar.

Isma said that the production has reached about 314 lakh tonnes as of the end of April 2024. With additional output of 5-6 lakh tonnes expected from mills in Karnataka and Tamil Nadu, the final net sugar production is estimated to be close to 320 lakh tonnes in 2023-24 marketing year (October-September). The net sugar production stood at 328.2 lakh tonnes during the 2022-23 marketing year with a diversion of 38 lakh tonnes of sweetener for ethanol-making from sugarcane juice and B-heavy molasses.

Taking into account an opening stock of around 56 lakh tonnes as of October 01, 2023, and a forecasted domestic consumption of 285 lakh tonnes for the season, Isma projects a significantly higher closing stock of 91 lakh tonnes by September 30, 2024. This estimate, amounting to 36 lakh tonnes above the normative stock of 55 lakh tonnes, can potentially lead to additional costs for the millers on account of idle inventory and carrying costs.

The association also expects a moderate crushing season in 2024-25 due to several factors, including the early announcement of an increased Fair and Remunerative Price (FRP) for sugarcane, favourable pre-monsoon rainfall, and forecasts indicating an above-normal monsoon. These factors are further expected to lead to a higher stock in the coming year. 

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