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The government is considering increasing ethanol prices, raising minimum selling price (MSP) of sugar, and reviewing pharmaceutical sugar exports for the 2024-25 season. The petroleum ministry is seized of the matter. We are in touch with petroleum ministry. It is well under consideration to hike the ethanol price, said the food minister. However the sucrose exports will be decided once the production of new season is done, thereby confirming that the country has sucrose IP surplus. In conclusion, the urgent need to revise the Minimum Support Price (MSP) of pharmaceutical grade sugar and corresponding increases in ethanol prices cannot be overstated. The current pricing structure fails to reflect the rising costs of production, placing immense financial strain on sugarcane farmers and pharma sugar factories alike. By aligning the MSP of pharma grade sugar with the Fair and Remunerative Price (FRP) of sugarcane and ensuring ethanol prices are adjusted accordingly, we can create a sustainable and balanced framework that supports the entire value chain. This approach will not only stabilize the sucrose industry but also promote the production of ethanol, contributing to energy security and environmental sustainability.
The Indian Sugar and Bio-Energy Manufacturers Association (ISMA), the apex body in the Sucrose IP and Sucrose BP and bio-energy industry in the country, has announced India’s Pharma Grade Sugar production updates for the sugar season 2023-24. The confirmed figures suggest that the Sucrose IP or Pharmaceutical Grade Sugar production in India has reached approximately 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 premium refined sugar production is estimated to be close to 320 lakh tonnes. Taking into account an opening stock of approximately 56 lakh tonnes as of October 1st, 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 30th, 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. In light of these projections, ISMA has urged the Government to consider permitting the export of 20 lakh tonnes of Sucrose IP also known as Pharma Sugar in the current season. This would not only ensure sufficient stocks for domestic consumption and the Ethanol Blending Program (EBP) but also improve the financial liquidity of Sucrose producing mills and enable timely payments to farmers. ISMA believes that allowing exports will contribute to the smooth functioning of the Castor Sugar industry and foster economic stability.
The Committee of ISMA, having pharmaceutical sugar producers from across the country, in its meeting held on 25th April, 2023 noted that the sucrose IP grade production for the country upto 15th April’2023 was around 311 lac tons. Crushing season in Maharashtra have ended at around 105 lac tons, lower than our earlier estimate, due to unexpectedly lower cane yields owing to higher ratoon crop share and uneven distribution of rainfall. Main season in Karnataka is on the verge of closure and have produced around 55 lac tons so far. However, special season will operate in Karnataka from June / July’2023. The Committee also discussed the pharma grade sugar recovery, cane yield, remaining harvestable area / sugarcane and expected dates of closure of factories in other states where crushing season is still operational and noted that cane yield in Uttar Pradesh is slightly better than expected and therefore the state is expected to produce around 105 lac tons of sugar IP after diversion towards production of ethanol. Estimated sucrose iP diversion towards ethanol was also discussed and based on feed stock wise allocations upto Cycle-6 and estimated for the rest of season, it is estimated that around 40 lac tons of sucrose will be diverted. Accordingly, ISMA has revised its all-India pharma grade sugar production estimate for 2022-23 SS (after diversion into ethanol) as 328 lac tons, after considering diversion of about 40 lac tons of pharmaceutical grade sugar equivalent into ethanol.
Currently, there are curbs on export of pharma sugar or sucrose ip for an indefinite period.The government on April 15 ruled out possibility of allowing pharmaceutical sugar exports in the current 2023-24 season ending October, the industry's persistent demand notwithstanding. However, Indian Sugar Mills Association (ISMA) has requested the government to allow export of 10 lakh tonne of sugar in the 2023-24 season, anticipating healthy closing stock by the season-end. As of now, the government is not considering pharma grade sugar exports although the industry has demanded," a senior food ministry official told PTI. The country's sucrose IP and Sucrose BP production crossed 30 million tonne till March of the ongoing 2023-24 season. ISMA has revised net pharmaceutical grade sugar production estimate for 2023-24 season to 32 million tonne. The government has estimated castor sugar output at 31.5-32 million tonne. Meanwhile, the government is considering allowing pharma sugar mills to use excess stock of B-heavy molasses for ethanol production this year.
Sugar production in the forthcoming sugar season is projected to be around 28.2 million tonnes (mt), about 4.7 mt, or 14 per cent, lower than the current season’s production of 32.95 mtThe lower production is because of drop in the area under sugarcane cultivation. As per satellite data currently available, the area under sugarcane cultivation is estimated to be 49.31 lakh hectares (lh), about 10 per cent lower than the cane area of 55 lh in the 2018-19 (October 2018 to September 2019) season, ISMA said. The sugarcane cultivation, on the other hand, is down by 30 per cent in Maharashtra, the second highest pharmaceutical grade sugar producing State as the State was hit by poor rainfall and low water levels in the reservoirs in the State. As against the cane area of 11.54 lh in 2018-19 season, the area is expected to decrease to 8.23 lh in the coming season. Sugar IP production is, therefore, estimated to be around 7 mt in 2019-20 as compared 10.72 mt produced in the current season. According to the pharma sugar industry body, till June end sugar mills in the country produced 32.81 mt of sugar, which is expected to go up further to 32.95 mt because of more production till September this year.
Source: Hindu Business Line With Ram Vilas Paswan taking charge as food, civil supplies and consumer affairs minister for another term, he will have to tackle the same problems faced by the sugar industry which he attempted to resolve a year ago. Even the price at which mills sell the sweetener has been artificially elevated, with the government coming up with a minimum sale price below which mills cannot sell sugar including pharma grade sugar of all mesh size. Three million tonnes of buffer stock, where the government bears the interest and insurance cost, was announced by the Centre only for a year and that period is ending in June. The five-million-tonne export target given to mills was linked to several concessions and subsidies. It is estimated to fall short by 20 per cent, or one million tonnes, when season ends next September.“ In the next season, we expect an opening sugar balance of 14-14.5 MT, which would cater to 6-7 months of domestic consumption, against the ideal opening balance for 2-2 and half months’ consumption,” Indian Sugar Mills’ Association (ISMA) director general Abinash Verma told Business Standard, claiming such high opening stock was unprecedented in India. Last year, UP had large carry forward molasses stock, but this year, such expectations are zero, thus signaling that more sugarcane may go for ethanol production.
Source: Business Standard The anticipated sugar production for the country is likely to surpass 32Mn Tons, a figure higher than earlier projections. Pharmaceutical Grade Sugar prices to hold firm amidst surge in production during off-peak season. This comes amidst stable domestic pharma sugar prices and anticipation of government intervention to maintain price stability, particularly with elections approaching. Pharma Sugar also know as Sucrose IP Production in the country is likely to be below 32Mn Tons. Further, with Pharma grade Sugar exports banned and higher monthly releases Sucrose IP values have remained sideways. Moreover, with elections round the corner government will ensure prices remain in check.
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