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India sees an increase in Sugar Exports

Posted on March 20, 2023 by admin1  1024

In News

  •  India has become the world’s largest producer and consumer of sugar.

About

  • Sugarcane is a tall, perennial grass used to make sugar, ethanol and paper. 
  • Sugar industry impacts the livelihood of about 50 million sugarcane farmers and around 5 lakh workers directly employed in sugar mills.
  • Crop Conditions: 
    • Temperature: Between 21-27°C with hot and humid climate.
    • Rainfall: Around 75-100 cm.
    • Soil Type: Deep rich loamy soil.It can be grown on all varieties of soils ranging from sandy loam to clay loam given these soils should be well drained.
  • Top Sugarcane Producing States: Uttar Pradesh, Maharashtra, Karnataka, Tamil Nadu, Bihar.
  • Distribution Of Industry : 
    • Sugar industry is concentrated around two major areas of production- Uttar Pradesh, Bihar, Haryana and Punjab in the north and Maharashtra, Karnataka, Tamil Nadu and Andhra Pradesh in the south.
    • South India has a tropical climate which is suitable for higher sucrose content resulting in a higher yield per unit area as compared to north India.
  • Sugar exports have shown an impressive trend .This can be seen from the fact that during the 2016-17 and 2017-18 sugar years (Oct-Sept), India’s shipments were a mere 0.46 lakh tonnes (lt) and 6.2 lt respectively. They had zoomed to 110 lt by 2021-22. 

  • Reasons for Increase in Exports:
    • Impressive Sugar Season (Sep-Oct): All records of sugarcane production, sugar production, sugar exports, cane procured, cane dues paid and ethanol production was made during the last years season.
    • Shift From Refined to Raw Sugar: Exporters started focussing on raw sugar .Much of the world sugar trade is in ‘raws’ that are transported in bulk vessels of 40,000-70,000 tonnes capacity.
    • Indian Government Policy Initiatives: Timely government initiatives in the last 5 years have taken the sugar industry  out of financial distress in 2018-19 to the stage of self-sufficiency in 2021-22.

Government Initiatives:

  • Encouraging Ethanol Production: The Government has encouraged sugar mills to divert sugar to ethanol and also export surplus sugar so that mills may have better financial conditions to continue their operations.
  • Ethanol Blending with Petrol (EBP) Programme: The National Policy on Biofuels 2018, provides an indicative target of 20% ethanol blending under the Ethanol Blended Petrol (EBP) Programme .
  • Fair and remunerative price (FRP): The FRP is the minimum price that sugar mills have to pay to sugarcane farmers for procurement of sugarcane. Government has increased FRP by more than 34% in the past 8 years.

Challenges:

  • Uncertain Production Output: Sugarcane has to compete with several other food and cash crops like cotton, oil seeds, rice, etc. By nature being a water guzzling crop it’s productivity depends on monsoon and  varies from year to year causing fluctuations in prices leading to losses in times of excess production due to low prices.
  • Low Yield of Sugarcane: India’s yield per hectare is extremely low as compared to some of the major sugarcane producing countries of the world. For example, India’s yield is only 64.5 tonnes/hectare as compared to 90 tonnes in Java and 121 tonnes in Hawaii.
  • Short Crushing Season: Sugar production is a seasonal industry with a short crushing season varying normally from 4 to 7 months in a year.
    • It causes financial loss and seasonal employment for workers and lack of full utilisation of sugar mills.
  • Low Sugar Recovery Rate: The average rate of recovery of sugar from sugarcane in India is less than 10% which is quite low as compared to other major sugar producing countries.
  • High Production Cost: High cost of sugarcane, inefficient technology, the uneconomic process of production and heavy excise duty result in high cost of manufacturing.

WayForward:

  • The sugarcane is a water guzzling crop. More Research and development in sugarcane can help address issues like sustainability, low yield and low sugar recovery rates.
  • A fixed export policy will help in building supply chains  which can result in higher price realisation for Farmers.
  • The government should encourage value addition preferably with the help of co-operative enterprises for better price realisation.
  • India should also look forward to producing sugar from beets in order to save scarce water resources.

Source: IE

 
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