Mumbai: Decline in sugar recovery continues to pose a challenge for sugar factories this season. It is likely to hit mills profit margin.
Delay in the commencement of cane crushing season has affected the many mills in the country. Flood and drought in Maharashtra have impacted the sugarcane crushing season in the state.
Sugar production in Maharashtra is down in the season 2019-2020 as the state had been gripped with drought and flood. According to the ISMA, In Maharashtra, 137 sugar mills, which are in operation, have produced 16.50 lakh tonnes till 31st December, 2019, as against 187 sugar mills which had produced 44.57 lakh tonnes last year upto same period. From the beginning of the season and till 31st December, 2019, average sugar recovery % in the State stands at 10% as against 10.5% achieved for the corresponding period of 2018-19. This is because a part of the crushing includes the flood affected sugarcane, which lost some of its sucrose because it was waterlogged for some time.
The flood has damaged sugarcane in many districts in Karnataka as well. In Karnataka as well, sugar recovery has been impacted. 63 sugar mills in Karnataka were in operation till 31st December, 2019, who have produced 16.33 lakh tonnes of sugar, as compared to 21.03 lakh tonnes produced by 65 sugar mills in the previous season on 31st December, 2018.
A senior official associated with one sugar mill said,”Most of the sugar mills have cleared their pending dues and are also at the forefront in clearing this year’s dues from the profit earned through export subsidy and sale of ethanol. Now the decline in cane recovery is posing a big challenge for the sugar industry this year. Because of the delayed start of crushing, profit margins in December quarter would remain muted which may recover in March quarter.”
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