India’s government now forecasts 2020/21 sugar manufacturing at 30.2 MMT, down 800,000 MT from the previous forecast.
Per The Financial Express, production is seen below expectations in the key cane states Uttar Pradesh, with unseasonal rains contributing to a drop in production of some 2.4 MMT of sugar this season. Maharashtra’s output, however, is seen up around 4.1 MMT from poor production last season. Other states may see modest increases.
India’s final 2020/21 production will depend on how much in-process sugar is diverted to ethanol manufacturing. Ethanol used for blending this season might reach 2.83 billion liters. Per the India Express, that production will include 597 million liters from grade-C molasses, 422 million liters from sugarcane juice, and 1.810 million liters from second or B molasses.
ISMA had previously estimated that ethanol manufacturing would lower Indian sugar output by over 2.1 MMT. Currently, taxes in place should encourage higher blending by the domestic fuel industry, with the sales tax on ethanol cut from 18 percent to 5 percent in 2018.