According to the sugar industry, mill production of sugar, net of ethanol diversion, is expected to drop 7% annually to a five-year low of 29.5 million tonnes (MT) in the 2024–25 season (October–September). Red-rot illnesses that have affected yield in portions of Uttar Pradesh and a decreased recovery rate due to insufficient monsoon rainfall in 2023 are the reasons for the output decline.
But according to the industry, there will be enough inventory to satisfy demand during the upcoming holiday season. The 2024–2025 season is expected to end with a sugar production of 26.1-26.2 MT, of which 25.74 MT of sweetener has already been produced, according to the Indian Sugar and Bio-Energy Manufacturers Association.
This does not include the 3.3 to 3.4 MT of sugar that would be diverted for the current season’s ethanol production. Just 2.15 MT of sugar was diverted for the production of biofuel in the 2023–24 season.
Out of 534 mills in important developing states including Uttar Pradesh, Maharashtra, and Karnataka, crushing is currently finished, with the exception of two in Tamil Nadu. Next month marks the start of Tamil Nadu and Karnataka’s special crushing season.
According to industry projections, sugar exports are expected to be about 0.9 MT this season, while domestic sweetener demand is expected to be 28 MT. On October 1, sugarcane is crushed for the upcoming season, and within two months, sweeteners begin to appear on the market.
In January 2025, after limiting the export of sweeteners during the 2023–24 season, the government permitted the export of one metric tonne of sugar during the current 2024–25 season, taking into account domestic supply and the shift to ethanol production.
Earlier this month, the government approved a 4% increase in the fair and remunerative price (FRP) of sugarcane, which mills will pay farmers for the 2025–2026 sugar season (October–September), to Rs 355/quintal.
