India Likely to Have Surplus Sugar Stocks of 5.4 Million Tonnes: ISMA

The Indian Sugar and Bio-Energy Manufacturers Association (ISMA) expects India to end the current sugar season (October-September) with surplus sugar stocks of approximately 5.4 million tonnes (mt). The association attributes this surplus to favorable weather conditions and improved cane planting, ensuring sufficient sugar availability for domestic consumption, ethanol production, and exports.

Sugar Cane Acreage Expansion

The enhanced monsoon conditions in 2024 have positively impacted sugarcane planting, particularly in Maharashtra and Karnataka. Maharashtra achieved planting coverage of approximately 7 lakh hectares (lh) by January, surpassing last year's figure by around 1 lh. However, Karnataka's cane planting was only marginally ahead by about 2,000 hectares compared to last year.

Varietal Replacement and Yield Improvement

Efforts to introduce new cane varieties in Uttar Pradesh (UP) and other northern states have started showing positive outcomes. These varietal replacements are expected to improve yield and sugar recovery rates, contributing significantly to increased sugar output next season. However, UP experienced slightly reduced cane planting by about 5,000 hectares compared to the previous year by January-end.

Sugar Production and Export Scenario

ISMA highlighted that sugar production from October to September in the current season stood at 2.88 mt, reflecting a significant decline of 33% compared to 4.29 mt produced during the same period last year.

The government’s timely decision to allow 1 mt sugar exports in January 2025 positively impacted the sugar industry, addressing inventory issues and stabilizing domestic prices.

Outstanding Cane Dues and Market Stability

As of December 2024, the sugar industry faced outstanding cane dues of approximately USD 1,08 billion, the highest in five years. ISMA credits the government's export policy with easing financial pressures, allowing mills to clear payments promptly.

This policy enabled sugar mills to maintain financial stability, ensure timely payments to approximately 55 million farmers, and sustain economic stability within the sugar sector.