India's sugar production declines 12%, crushing season moving towards end

India's sugar production until February 15 of the 2024-25 sugar season reached 197.03 lakh tons, a 12% decline from the 224.15 lakh tons produced during the same period last year. This drop is attributed to multiple factors, including sugarcane crop damage, a reduced number of operational sugar factories, and increased ethanol diversion.

According to data released by the Indian Sugar and Bio-Energy Manufacturers Association (ISMA), the number of operational sugar factories stands at 460, compared to 504 units in operation on the corresponding date last year.

Source: ISMA

The National Federation of Cooperative Sugar Factories Ltd. (NFCSF) stated in a press release that as of February 15, a total of 77 sugar mills have concluded their crushing operations, while 454 factories continue the crushing season, compared to 505 factories in operation on the same date last year.

Despite an overall production decline, sugar mills in Uttar Pradesh have maintained a better crushing rate than last year. Additionally, the sucrose percentage in plant cane across the state has shown improvement, reaching levels comparable to the same period last season. As a result, it is expected to partially offset the lower sugar recovery experienced during the first half of the season by the end of this season, ISMA stated in a press release.

However, the scenario in Maharashtra and Karnataka presents a different picture. Factories in some regions of Maharashtra and Karnataka have started closing. About 58 factories have closed across both states so far, compared to 22 closures during the same period last year. Some factories in South Karnataka are expected to restart operations during the special season from June/July to September 2025.

According to NFCSF, the average sugar recovery (excluding diversion for ethanol production) in the country has been 9.09%, which is 0.78% lower than the 9.87% recorded on the same date last year. Taking all factors into account, this year's net sugar production is expected to be limited to 270 lakh tonnes, approximately 49 lakh tonnes (15.36%) less than the net sugar production of 319 lakh tonnes last year. In addition, about 37 lakh tonnes of sugar will be diverted for ethanol production.

"It is expected that after analyzing all the figures, the level of selling prices in the local market will remain satisfactory, ensuring that factories can pay off their cane dues to sugarcane farmers. However, there has been no increase in the minimum selling price of sugar or the purchase price of ethanol produced from the sugar industry. An early decision on both will help improve the cash liquidity of the factories," said Harshvardhan Patil, President of the National Federation of Cooperative Sugar Factories (NFCSF).