Indian Sugar and Bio-Energy Manufacturers Association Cuts Production Outlook Amid Falling Yields

Lower yields of sugarcane, which is due to the heavy rains in the major sugarcane-producing countries, could lead to a reduction in the production of sugar in the country. This will affect the exports of the commodity from the second-largest producer in the world. It has been stated that the country will be unable to export even half of its export quota, which is supporting the price of the commodity, as it is at a five-year low.

According to estimates provided by five trade bodies, India is likely to produce 28.5 to 29 million tons of sugar in the 2025-26 marketing season that will end in September. The Indian Sugar and Bio-Energy Manufacturers Association has estimated the production of sugar for the current year to be 30.9 million tons. Rahil Shaikh, Managing Director of MEIR Commodities India, said, "Yields have declined in all major sugarcane-producing states. This is reducing production estimates for the current season."

According to a state government official, Maharashtra has produced 9 million tons of sugar so far this season. Nearly half of the 207 mills that had begun crushing have shut down due to a shortage of sugarcane. A Mumbai-based dealer said, "The decline in sugar production and the expected increase in demand during the summer season from next month are likely to support prices."

Maharashtra, the largest sugarcane producer, is expected to suffer the most. Production in the state is expected to be 9.6 million tons compared to the earlier estimate of 10.8 million tons. About five dozen farmers in sugarcane-producing areas of Maharashtra and neighboring Karnataka reported that excessive rains affected sugarcane root growth and caused premature ripening of the crop. Farmers said, "We expected a yield of at least 60 tons of sugarcane per acre, but it was only 48 tons." Sugarcane-producing areas of Maharashtra received 115 per cent more rainfall than normal in September.