Sugar glut may worsen payment delays to farmers: ISMA

Livemint – 8 March 2018, New Delhi: India’s sugar production during the 2017-18 season is likely at a record 29.5 million tonnes and the output glut may result in ‘uncomfortable levels’ of payment delays to cane growers, trade lobby Indian Sugar Mills Association (ISMA) said on Wednesday.

ISMA’s latest production estimate is a sharp 13% upward revision from its second advance estimate of 26.1 million tonnes, due to record yields in states like Maharashtra and Karnataka. The latest estimates imply a staggering 45% rise in sugar production year-on-year (2017-18 over 2016-17).

Sugar production during the current crushing season will exceed domestic consumption by about 4.5 million tonnes, ISMA said in a statement, adding, “a part of this needs to be exported (by September)… to ensure better payment to the farmers and reduction in the cane price arrears, which is accumulating very fast to uncomfortable levels.”

“The government is exploring measures like export incentives and generating extra revenues to help mills clear dues to farmers,” said a senior food ministry official, requesting anonymity.

Dues to farmers till 31 January were close to Rs14,000 crore, Mint reported earlier this week. To improve the financial situation of sugar mills, the Centre had recently imposed a 100% duty on import of raw and white sugar, and placed limits on sugar sales by mills.