Maharashtra sugar output likely to drop but prices to be stable

Owing to a prolonged spell of drought in Maharashtra, sugar production could decline 40 percent, but market prices of the sweetener will remain stable, an industry official said today.

Speaking to reporters, Shivajirao Nagavade, Chairman of Maharashtra State Cooperative Sugar Factories Federation (MSCSFF), said that this year, the sugarcane acreage is 6.33 lakh hectares on which an estimated 485 lakh metric tonne of cane output is expected.

"Sugar production is expected to be 50 lakh metric tonne, which is a 40 percent reduction from the previous year. However, the State has surplus stock of 33 lakh metric tonnes as on October 1 this year," he said.

Despite a fall in output, the market price of sugar is expected to remain stable, Nagavade said.

He said a Cabinet Committee headed by Chief Minister Devendra Fadnavis, at a meeting yesterday, decided to start sugarcane crushing season from December 1.

However, if Karnataka starts its crushing season from November 1, sugar units in Kolhapur and other areas bordering the adjoining State would also do the same, he said.

Nagavade said that about 150 sugar co-operatives in Maharashtra would participate in the crushing season which will last for about two months.

He said the Government will give bank guarantee to sugar units with negative networth for availing short-term loan. Due to a decline in sugar production, many units are likely to stay shut or resort to low capacity crushing.

Nagavade said the purchase tax for sugarcane has been waived for 2015-16 and 2016-17.