Thursday, May 15, 2008

Sugar Mills May Be Hit As Cane Area Shrinks

New Delhi: The country’s two leading sugar producing States — Uttar Pradesh and Maharashtra — may see significant reductions in cane availability during the ensuing 2008-09 crushing season (October-September).

Farmers in UP normally plant sugarcane during March-May, which is ready for crushing after 10-11 months from the subsequent late-January to April period. “This year, plantings are down by about 15 per cent. The area is lower by 10 per cent in western UP, 15 per cent in central and 20 per cent in the eastern region,” said C B Patodia, Adviser to the K K Birla Group of Sugar Companies.

But the problem is not just in respect to the plant-cane, but also the ratoon crop that does not require any planting and sprouts from the root stubbles of the harvested plant-cane. The ratoon is a shorter nine-month crop maturing between November and January, depending on when the previous plant-cane was harvested.

“Some growers this time have chosen not to tend even the ratoon crop. Instead, they have sown urad (black matpe) or jowar (sorghum) for fodder use. Both these can be harvested prior to the planting of paddy from June onwards. In a few cases, where the plant cane was harvested towards late-January, farmers have even gone for short-duration wheat,” according to Sanjay Tapriya, Director (Finance), Simbhaoli Sugars Ltd.

Changing preference

Anil Singh, General Secretary of the Kisan Jagriti Manch, said “wherever water-tables are high, especially along the Ganga and Yamuna river-beds, farmers are preferring paddy, for which they have already raised the nurseries”.

Growing cane had turned a ‘bitter experience’ for farmers, considering the Rs 2,400 crore of arrears in payments owed to them by mills in the current 2007-08 season.

“When returns from paddy, wheat, cotton or pulses are far more remunerative, why should any farmer lock up his land under sugarcane for more than twice the duration? The shift to paddy will be more in central and eastern UP than in the western parts, where the flexibility to forsake cane is less,” the farmer leader pointed out.

That would, in turn, hit cane supplies to mills in the coming season and more so during 2009-10, when the reduced planted cane area of this year would spill over to the subsequent ratoon crop.

The cane that is crushed in the early part of the season in UP (November-January) is largely the ratoon crop, with the harvested plant-cane being used from late-February till May (when mills close operations). “About 60-65 per cent of the cane crushed during the season is constituted by the ratoon crop and the remaining 35-40 per cent by the plant-cane,” Tapriya informed.

In Maharashtra, about three-fourths of the cane crushed by mills is the 15-month pre-seasonal crop, sown during July-September. “Our farmers planted about 20 per cent less pre-seasonal cane in July-September 2007, which is to be used in the new season. They have mostly shifted to soyabean, maize or sunflower, with many of them even uprooting the ratoon crop last September-October,” noted Prakash Naiknavare, Managing Director, Maharashtra State Cooperative Sugar Factories’ Federation.

During the current season, Maharashtra mills have, as on May 12, crushed 733.26 lakh tonnes (lt) of cane and produced 87.09 lt of sugar at an average recovery of 11.88 per cent. During the same period of the 2006-07 season, these numbers stood at 749.11 lt, 86.01 lt and 11.48 per cent.

“Though we crushed less cane this time, we have ended up producing more sugar because of unprecedented high recovery rates. On the whole, we expect to end the 2007-08 season with sugar output marginally below the previous season’s 90.91 lt, and the quantity of cane crushed falling from 798 lt to 775 lt,” Naiknavare added.

He projected a sharp drop in cane available for crushing in the 2008-09 season to 610 lt, leading to a sugar output of 68 lt, “with the situation turning further bullish in 2009-10”. Patodia estimated UP’s sugar output in 2008-09 at 65 lt, down from 74 lt of the current season and 84.75 lt in 2006-07.

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