Solapur: India's sugar production is likely to fall by 70% in 2022 due to erratic weather conditions that influenced cane yields. It can affect exports and sway the global market.
India is the world's second biggest exporter and lower sugar exports from the country can increase global sugar prices. This can also affect Brazil and Thailand to increase their exports, reported Reuters.
Farmers said the summer was harsh and July recorded too much rainfall. This led to fields being waterlogged and crops not getting enough sunlight for weeks. A 15% drop has been reported in cane yield on average. However, some areas reported a 35% loss. According to sources, Maharashtra was expected to produce 13.8 million tonnes of sugar but delivered only 11.7 million tonnes. The state accounts for over a third of India's sugar output.
Karnataka was also affected by the weather changes. The state was expected to produce 6 million tonnes of sugar but now is likely to produce only 5.5 million tonnes. The low production in both states can bring down India's sugar output to 33.3 million tonnes from 35.8 million tonnes.
The Indian Sugar Mills Association expects the country to earmark up to 4 million tonnes of sugar for international export in the second tranche. New Delhi has allowed mills to export 6.15 million tonnes of sugar in the first tranche. A government official told Reuters that exports will be allowed after making sure there are enough supplies to fulfil the local demand of 27.5 million tonnes.