INDIA: UP mills agree to start crush a month early

Published: 08/30/2017, 5:07:10 PM

Unusual to the normal practice, large sugar mills in Uttar Pradesh have decided to commence crushing in October this year, almost a month ahead of the usual schedule, to boost supply of the sweetener and control shifting of cane supply to jaggery and khandsari units, according to India's Business Standard newspaper.

Normally, sugar mills in Uttar Pradesh start crushing activity early- to mid- November due to late maturing of standing cane in the field. Mills in western Karnataka and Maharashtra, however, begin crushing by mid-October with early variety of cane, which is usually as the highest yielding crop of the season.

Interestingly, the apex industry body Indian Sugar Mills Association (ISMA) has conducted a survey of its member mills across the country, which finds that large sugar mills in Uttar Pradesh are going to advance their cane crushing activity by a month. Industry estimates a bumper cane crop in Uttar Pradesh for the crushing season beginning October 2017, the second year in a row. The state reported sugar production at 8.2 million tonnes for 2016/17.

"Many sugar mills in Uttar Pradesh, Maharashtra, Karnataka and Tamil Nadu have given us in writing that they would start crushing by mid-October this year. Sugar mills in Uttar Pradesh normally do not start crushing in October. So, starting of crushing activity in October is something new for sugar mills in Uttar Pradesh. Accumulatively, sugar mills across all the four leading aforementioned sugar producing states are estimated to produce 800,000 tonnes of the sweetener this year in October," said Abinash Verma, director general, ISMA.

For sugar mills, early commencement of crushing would help control shifting of cane supply to jaggery and khandsari units (kolhus) especially in western Uttar Pradesh. In the absence of procurement of sugarcane from mills, small and marginal farmers in Uttar Pradesh supply their produce to kolhus to fetch instant cash. 

Secondly, the government has taken a number of steps to control sugar price hike which erupted over two months ago after reports of a decline in its output this year. ISMA estimated India's sugar output at 20.3 million tonnes this year compared to 25.1 million tonnes last year. After allowing 500,000 tonnes of sugar import this year, the government, on Tuesday, levied stock limit on mills.

"Sugar production in Maharashtra is estimated at 7 million tonnes for 2017/18 compared to 4.2 million tonnes in the previous year and 8.4 million tonnes for 2015/16. Cane output in Tamil Nadu and Karnataka is estimated to remain subdued," said B B Thombare, president, West Indian Sugar Mills Association (WISMA).

Data compiled by the Ministry of Agriculture showed cane sowing at 4.978 million ha by August 25, 2017 compared to 4.56 million ha by the same day last year.