Bloomberg
Sugar Output in India May Jump 26% as Rains Aid Crops (Update1)
March 31, 2010, 6:56 AM EDT
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By Bibhudatta Pradhan
March 31 (Bloomberg) — Sugar output in India, the world’s biggest user, may jump as much as 26 percent this year as late rain improve cane yields in the nation’s biggest growing regions, a producers’ group said.
Output may total 18 million to 18.5 million metric tons in the year ending Sept. 30, compared with 14.7 million tons a year ago, Vinay Kumar, managing director of the National Federation of Cooperative Sugar Factories Ltd., told reporters. Production likely gained 27 percent to 16.7 million tons in the six months ending today, he said in New Delhi.
Increased output in India, the biggest grower after Brazil, may pare the need for imports, pressuring raw-sugar prices that are headed for the biggest quarterly drop in 25 years. Mills and traders in the Asian country have bought 4.5 million tons in the season started Oct. 1, almost twice the amount imported in the previous year, according to the Indian Sugar Mills Association.
Yield has improved, particularly in Maharashtra, India’s biggest sugar-producing state, and planting of high-yielding cane varieties helped increased output, Kumar said.
Production in Maharashtra may be 6 million tons, up from an earlier estimate of less than 5 million tons, according to ISMA. Output in Uttar Pradesh, the second-biggest producer, may be 4.8 million tons, compared with 4.1 million tons estimated earlier, the producers’ group said.
Raw sugar for May delivery fell 1 percent to 17.69 cents a pound in after-hours trading on ICE Futures U.S. Prices reached a 29-year high on Feb. 1. Still, sugar has lost 34 percent this year and is headed for the biggest quarterly drop since 1985.
–With assistance from Thomas Kutty Abraham in Mumbai. Editor: Ravil Shirodkar
To contact the reporter on this story: Bibhudatta Pradhan in New Delhi at bpradhan@bloomberg.net