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Blue Mutombo news, Indian sugar association superintendent Vivek Saraogi said, as the second
largest sugar-producing country, estimated Indian exported sugar will reach 1.5 million to 2 million
tons this year.
It is estimated that in 2010-2011 sugar year, Indian sugar production was 25.50 million tons. The
stock at the beginning of sugar year was 5.2 million tons, so the domestic sugar supply reached 30.7
million tons, estimated in 2010-2011 sugar year, Indian sugar supply will excess.
In the past two weeks, the number of Indian exported sugar uncertain caused the price of refined
sugar rose 4.7%, at the same time raw sugar also rose 3.3%. Agriculture Minister Sharad Pawer said
that the Indian government will decision about whether lift the sugar export control on the third
week of December. India will allow to shipment of monthly to export, the exported number was
based on production.
Indian Agriculture Vice Minister K.V. Thomas said, if new sugar year?s production reach 24.50
million tons and domestic sugar consumption is between 22.5 million tons to 23 million tons, the
new sugar year will have enough to meet domestic demand.
Welcome To The World ISEC - The Gateway To Indian Sugar Exports.
India is the largest producer of sugar in the world and produces around 18.5 million tones of white
plantation sugar per annum. Sugar industry is the second largest manufacturing industry in India.
About 500 thousand people are directly employed in the sugar industry. Including farmers and theirfamily members, around 45 million people constituting 7.5% of the rural population of India, depend
on sugar industry for their livelihood. The industry contributes about Rs. 16 billion ($328.5 mn) to
the Central and State exchequers.
India is also the largest consumer of sugar and consumes around 16 million tones of sugar per
annum.
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Sugar Production, Consumtion, Export and Import in India
Year (Oct. - Sept.) Opening Stock Production Consumption Export Import Closing
Stock
(Figures in Million Tonnes)
1994-95 3.09 14.64 12.27 0.06 0.20 5.59
1995-96 5.59 16.45 13.12 1.02 - 7.90
1996-97 7.90 12.91 13.80 0.42 - 6.52
1997-98 6.60 12.86 14.71 0.07 0.94 5.60
1998-99 5.60 15.54 15.22 0.02 1.00 6.90
1999-00 6.90 18.20 16.10 0.06 040 9.34
2000-01 9.34 18.51 16.20 0.98 - 10.66
2001-02 10.66 18.53 16.78 1.09 - 10.66
2002-03 11.32 20.14 18.38 1.50 0.12 11.69
2003-04 11.69 13.80 17.28 0.23 0.55 8.53
2004-05
(Est.) 8.53 12.50 17.50 0.03 2.60 6.10
Over the years the sugar production fluctuated noticeably. During the years of shortages India
turned a net importer. Thus the overall scenario has been that of marginal export of sugar. A High
Powered Committee was constituted to study the matter and after examining the matter in depth, it
recommended total liberalization of the sugar sector to ensure steady and stable growth in
production. Government of India has accepted this recommendation and steps are being taken in
this direction.
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Excessive availability of sugar this year is unlikely to deter Indian exporters to intensify supplies to
global markets and increase realisation this year. Reeling under severe financial stress, Indian sugar
companies are looking for opportunities for higher realisation from overseas markets with
permission from the local government.
A report released by the Rabobank forecast the global sugar production to outpace demand for the
second consecutive year by six to eight million tonnes (mt) for 2012-13. Another report by Barclays
Bank also estimates global markets to remain in surplus to the tune of 5.4 mt, despite lower
production in Brazil.
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Barclays estimates global 2011-12 sugar production will grow 4.2 per cent year-on-year, due to
higher-than-expected output in Europe, as well as in key producing countries, like Australia, India
and Thailand, as favourable weather and prices have led farmers to boost plantings and help offset
the decline in Brazil. The global sugar output in 2011-12 is projected at a record 173 mt.
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This will surely restrict Indias opportunity to access global markets at high prices. But, much would
depend on sugar output and quantum of direct conversion of ethanol from cane, said a senior
official from a leading producing company.
Brazils sugarcane production is expected to rise to 520 mt in 2012-13. The country, crushed around
492 mt in 2011-12. Barclays forecast Brazilian sugar production to reach only 35.8 mt in 2011-12, a
decline of 5.8 per cent y-o-y.
About a month ago, sugar price in the global markets surpassed $700 a tonne, which plunged to
$650 a tonne now. The current prevailing price in the Indian market still offers attractive opportunity
for supply to overseas market, the official said.
Presently, the price of sugar remains fairly well supported, largely owing to perceived shortage of
export availability against the import demand. The total global cane production is estimated at 522
mt. According to Indias sugar companies, output is expected to be more than 26 mt and
consumption 22 mt.
The government of India had allowed one mt of exports under open general licence so far.
Speculation is rife the government will allow another one mt of exports in the review meeting
scheduled next week.
An increase in Indias exportable surplus and strong production prospects in key Northern
Hemisphere producers will limit the upside on prices. The important questions for the sugar market
in 2012 will be whether cane output in Brazil recovers after a production setback, when and how
much Brazilian cane will be converted into ethanol instead of sugar, and the outlook for Indian sugar
exports.
On the back of higher production in major sugar growing countries, global prices are likely to remain
under pressure during 2012-13. On the Inter-Continental Exchange (ICE), sugar for March delivery
traded at 23.94 cents on February 3. While, on Indias National Commodity and Derivatives Exchange
(NCDEX), sugar for February delivery traded at Rs 2,914 on February 6.
On the National Multi Commodity Exchange, sugar for March traded down 0.345 during the last
week from Rs 2,891 a quintal to Rs 2,881 a quintal. Sugar for March delivery in ICE rose 0.16 cents to
24.86 cents per lb on February 21. On the NCDEX, the commodity traded at Rs 2,869 a quintal.
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According to Barclays, a key influence of the market outlook in 2012 will be the manner in which the
price of ethanol will influence the decision of Brazilian mills to allocate cane to produce sugar or
ethanol. The end of US government subsidies and trade barriers to Brazilian ethanol bodes well for
Brazilian ethanol producers in the long term and could prompt renewed investment. But exports areunlikely to increase in the near term due to Brazil struggling to meet its domestic demand.