Pandemic fails to dampen India’s sugar consumption pattern

Lucknow, 17 June 2021

Contrary to general perception, the pandemic-induced lockdown has failed to dampen the sugar consumption pattern in India, which is the world's top consumer of the sweetener.

The domestic sugar mills have already sold about 856,000 tonnes more in the current 2020-21 (Oct-Sep) sugar season compared to the full 2019-20 cycle, when cumulative sales logged 25.3 million tonnes (MT), according to the Indian Sugar Mills Association (ISMA).

As such, the sugar sales in the current (2020-21) year may cross the estimation of 26 MT.

“There is a misunderstanding in the market that (the) demand for sugar has fallen in the last couple of months. It needs to be noted that sugar sales by mills in March, April and May 2021 were more than 2.2 MT, 2.3 MT and 2.2 MT respectively. These figures of sales are as reported by the sugar mills from across the country,” the Association informed.

In addition to higher domestic sales in the current year till the end of September 2021, over last season, sugar exports in the current year is also expected to jump to 7 MT, which gives the industry the confidence that the closing balance (of Sep 2021) will be 2-2.5 MT less than the closing balance of last season.

Citing market reports, ISMA said 5.8 MT of sugar export contracts against the Maximum Admissible Export Quota (MAEQ) of 6 MT for 2020-21 have already been entered into so far. Of this, about 4.57 MT have been physically shipped from India during Jan-May 2021, i.e., under the MAEQ programme. Another 600,000 tonnes of sugar is in the pipeline to be physically exported in June 2021.

At the same time, the sugar industry exported 449,000 tonnes in Oct-Dec 2020 quarter against the MAEQ of last season 2019-20.

Meanwhile, the Indian mills have produced nearly 30.67 MT of sugar between Oct 2020 and June 15, 2021, which is about 3.6 MT higher than the 27 MT produced in the corresponding period last year.

Uttar Pradesh mills have produced over 11.06 MT of sugar till June 15, which is nearly 1.57 MT lower than the output of 12.63 MT last year. Now only one unit of the total 120 mills in the state is currently functional.

In Maharashtra, the crushing season had concluded by May 31, 2021, with the total output at 10.63 MT, which is 4.46 MT higher than the 6.17 MT produced in 2019-20.

Likewise, in Karnataka, all the operating mills had closed their main crushing season by April 15 and produced 4.17 MT compared to the 3.38 MT last year. However, one mill in South Karnataka has commenced operation for the special season. Last year, during the special season, the state mills produced 114,000 tonnes of sugar.

In Tamil Nadu (TN), out of the 28 sugar mills which operated in this season, three are currently in operation for the special season. Till June 15, 2021, sugar production in TN was 670,000 tonnes compared to 612,000 tonnes in the corresponding period last season.

The remaining states of Gujarat, Andhra Pradesh, Telangana, Bihar, Uttarakhand, Punjab, Haryana, Madhya Pradesh, Chhattisgarh, Rajasthan and Odisha have also concluded their crushing operations for the current season and collectively produced 4.14 MT.

(Virendra Singh Rawat is a Lucknow-based journalist who writes on contemporary issues of industry, economy, agriculture, infrastructure, budget etc.)