India has emerged as the World’s largest producer and consumer of sugar and the second-largest exporter of sugar. It is interesting to understand the finances of this sweet sugar.
The sugar season is from October to November every year. This year the government has decided to allow the port of sugar up to a reasonable limit in order to prevent uncontrolled export of sugar and to ensure sufficient availability of sugar in domestic markets at reasonable prices.
The government has hence approved the export of 6 million tonnes of sugar on a quota basis till 31 May. As per the notification released by the food ministry a uniform export quota of 18.23 percent of the three years average production of this cherished sweetener.
This export can be done by the sugar mills themselves or through the exporters or can be swapped with domestic quotas of other mills.
As per the official policy, this figure has been decided till May end, further, allocation will be decided in the basis of levels of sugar production.
Sugar cultivation in different parts of India
The season of sugar production has already started in Maharashtra and Karnataka while in states like Uttar Pradesh and other sugar-cultivating states it will start in the third week of November.
At the end of the 2021-22 October – September cycle last year the government restricted sugar exports to ensure the availability of sufficient stocks for domestic consumption and prevent any unexpected rise in the vernacular commodity in festive seasons.
Maharashtra and Uttar Pradesh are the key sugar-producing regions of the country, this directly employs about 500 million agricultural farmers and laborers, and I directly about 5 lakh employees who work in agro-based sugar-related industries.
In the previous sugar season 2021-22 a record of more than 5000 lac metric tonnes of sugarcane was produced in the country which made new records in sugarcane production, sugar production, cane procured, cane dues paid and ethanol production. Supportive International prices and Indian policy on sugar exports led to huge exports of about 109.8 lac metric tonnes which earned about Rs. 40,000 crores foreign currency for the country.
The diversion of sugar to ethanol and exports has led to the unlocking of the value chain of the entire industry as well as improved financial conditions for the sugar mills leading to even wonderful outcomes for the future as we look ahead in the sugar industry.
