Mills produced 408,000 metric tons until Nov. 20, compared with 573,000 tons a year ago, saidPrakash Naiknavare, managing director of the Maharashtra State Cooperative Sugar Factories Federation Ltd. About 5 million tons of cane has been crushed, 20 percent less than a year earlier, he said.
A delay in Indian harvests may prompt the government to defer a decision on freeing exports, supporting a 72 percent rally in global prices in the past six months. The country will be “cautious” on ending the curbs to ensure local supplies are adequate, Junior Farm Minister K.V. Thomas said last week.
“Any delay in exports from India will be a big kicker for prices,” said Nirmal Shah, an analyst at Alchemy Share & Stock Brokers. “With yield and recovery being lower than estimated, the government may be wary of rushing into making a decision.”
Raw sugar for March delivery slumped 7.1 percent to 26.15 cents a pound on ICE Futures U.S. in New York on Friday. White sugar for March delivery fell 4.2 percent to $679.10 a ton in London the same day. Prices closed at a 29-year high on Nov. 9.
India may probably produce 23.27 million tons, 8.7 percent less than predicted by industry groups, according to data from farmers interviewed by SGS SA for Bloomberg News. Output may be 24.5 million tons, Thomas told lawmakers Nov. 19, less than 25 million tons forecast by Farm Minister Sharad Pawar on Nov. 11.
The recovery rate narrowed to an average 8.17 percent this season in Maharashtra from 9.14 percent a year ago, Naiknavare said. Sucrose content may rebound after rains halt and as the peak December-February period for crushing approaches, he said.
“If the recovery rate doesn’t improve, then we may have to revise our earlier estimates,” he said.
Output in Maharashtra may jump 34 percent to a record 9.5 million tons, with mills processing 82.5 million tons, compared with 61.4 million tons last season, the group said Sept. 15.
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