Optimistic Projections for Indian Sugar Output in 2024-25

Projected Sugar Output

The Indian Sugar Mills and Bio-Energy Manufacturers Association (ISMA) has projected the sugar output for the 2024-25 season at 33.11 million tonnes (mt). This estimate is slightly lower than the previous year’s output of 33.995 mt. The decline is attributed to reduced sugarcane acreage in critical states such as Maharashtra and Karnataka.

Acreage and Production Insights

ISMA’s projections are based on satellite images obtained in late June 2024, which estimate total sugarcane acreage at 5.61 million hectares (mh). This represents a six percent decrease from the previous year’s 5.944 mh. Despite this reduction, the sugar market is expected to remain balanced due to sufficient excess stocks supporting the Ethanol Blending programme and exports. In Uttar Pradesh, sugarcane acreage is estimated to decrease by three per cent to 2.332 mph. However, sugar output in the state is projected to increase to 11.3 mt from 10.976 mt last year.

Regional Production Variations

Maharashtra’s sugarcane acreage is expected to decrease by 13 percent to 1.310 mh, with an estimated sugar output of 11.102 mt, down from 11.718 mt last year. Similarly, Karnataka’s sugarcane acreage is projected to decline by eight percent to 0.620 mh, with sugar output expected to fall to 5.651 mt from 5.824 mt the previous year. The reduction in these states is primarily due to last year’s deficient rainfall in central cane-growing districts.

Despite the reduced acreage, rainfall in the current year has been abundant, approximately 30 per cent above average. The optimistic rainfall forecast for the remainder of the monsoon season is anticipated to enhance cane productivity and sugar recovery. This improved water availability is expected to mitigate the impact of the reduced cane area, resulting in only a minimal decline of 3-5 per cent in gross sugar production in Maharashtra and Karnataka.

Overall Market Outlook

ISMA is optimistic about the overall sugar market for the 2024-25 season. The projected opening stocks as of October 1, 2024, are estimated at 9.05 mt, with a gross sugar production of 33.3 mt. The total availability of sugar during the year is expected to be 42.35 mt, with domestic consumption estimated at 29.0 mt. By September 30, 2025, the closing stock is projected at 13.35 mt. Excluding the normative stocks of 5.5 mt, the excess stocks are pegged at 7.85 mt. These projections assume average rainfall and other optimal conditions for the remainder of the season.

The Indian sugar market is projected to experience a slight decline in production for the 2024-25 season due to reduced sugarcane acreage. However, sufficient excess stocks and improved water availability are expected to support a balanced market. Exporters can expect a stable and productive season, with optimistic projections for overall market health.

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