As of the end of January, Indian mills have produced 18.71 MMT of sugar, marking a 3.2% decrease compared to the 19.33 MMT produced during the same period in the previous season.
Recent data releases have aligned with market expectations and highlighted a narrowing gap in sugar production. The difference in output between the 23/24 and 22/23 seasons has reduced from 7% to 4%, as of the end of the previous month.
Thanks to the better-than-expected late-season harvests, market forecasts are now adjusting to anticipate a sugar production of approximately 31.6 MMT for the 23/24 season, after accounting for ethanol diversion. This represents a 4% decrease compared to the previous season’s output. Despite this, India’s stance on not exporting sugar remains consistent. With the country meeting its production expectations, it’s more probable that any surplus will be channelled toward ethanol production.
The Indian government is contemplating an 8% increase in the minimum price of sugarcane for the 24/25 season, known as the Fair and Remunerative Price (FRP). This move is aimed at enhancing sugar availability in the country. Unlike previous years when the FRP was set a few months before the new crop season, there might be an earlier announcement this year. This anticipated early declaration is seen as a factor driving up sugar prices.
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