Press "Enter" to skip to content

Maharashtra low on cane: Barely a month into the season, sugar mills stop crushing

Of 135 mills that began crushing in state a month ago, two have stopped work citing lack of availability of cane and workers.

Barely a month after the commencement of crushing operations in the state, a couple of cooperative sugar factories in Maharashtra, located in Ahmednagar and Aurangabad regions, have stopped their exercises.

Maharashtra sugar commissioner Shekhar Gaikwad said of the 135 mills that began crushing in the state a month ago, two have already stopped work citing lack of availability of raw materials (cane) and workers needed in harvesting.

The Kedareshwar Cooperative Sugar Factory in Ahmednagar region and Sharad Paithan Cooperative Sugar Factory in Aurangabad region have completed operations for the season, crushing around 1,500 tonne to 2,000 tonne of cane.

Gaikwad had earlier stated that over the next 30 days about 70% mills would complete their operations on account of low cane availability. The sugar season in Maharashtra is currently at its peak, but the majority of mills are expected to finish their operations by the end of January 2020 because of lower acreage, diversion of cane for fodder and crop losses due to floods. While mills in Marathwada region are expected to start shutting down by January-end, some factories in Western Maharashtra may continue crushing till the end of February, officials stated. A meeting is slated to be held with mill owners next week following which the exact situation will be known.

To date 154 lakh tonne of cane has been crushed to produce 153 lakh quintal of sugar with a recovery rate of 9.94%. Normally, the sugar season in Maharashtra starts after Diwali and continues till the end of March. But the sugar season of FY 2019-20 is curtailed by about 60 days as the acreage has shrunk to about 8.22 lakh hectare, against last season’s (2018-19) 11.62 lakh hectare. Most mills in and around Kolhapur region will close by January. However, a handful of co-operative sugar mills, Shree Dutta at Shirol in Kolhapur being one of them, will continue their crushing operations till March 2020 as they have a strong member team of over 45,000 farmers and large areas under cane cultivation.

Meanwhile, the sugar commissioner’s office has reduced sugar production estimates to 52 lakh tonne, citing diversion of cane to fodder and ethanol production. Earlier, the commissioner had estimated Maharashtra’s sugar production to touch 58 lakh tonne. Around 24 mills will be producing ethanol while six have been producing ethanol directly from cane juice, he said. Rohit Pawar, former chairman, Indian Sugar Mills Association and CEO, Baramati Agro, which operates private sugar mills in Pune and Aurangabad, said the final sugar production figure would be around 60 lakh tonne.

It may be noted that last week, citing lower molasses production in the 2019-20 season, the state government has decided to ban exports of molasses, produced in the 2019-20 season, till September 30,2020.

The state government figures reveal that Maharashtra produced 35 to 40 lakh tonne of sugar cane molasses in 2017-18. Of these, 35 lakh tonne have been used for the production of alcoholic beverages and livestock in the state, 1.77 lakh tonne has been exported to other states and 2.53 lakh tonne has been sent in overseas export.

Also, in six months between November 2018 and March 2019, 45.72 lakh tonne of paddy have been produced and 29.18 lakh tonne have been used in the state for distillation and cattle feed. Around 3.29 lakh tonne of molasses have been exported to other states and other nations.

Molasses is an important source of revenue for the state excise duty department. Molasses is mainly used for the manufacture of alcohol.

There are about 231 sugar factories, of which 134 are affiliated to the sugar factories, 95 of which are in Co-operative sector and 39 are approved by the private sector) Also, there are 19 Stand alone factories. The sugar factories that have set up the distillery and are producing Extra Neutral Alcohol which is widely used in the state for the purpose of supplying alcohol and potable alcohol. The consumption of head alcohol is 60:40 and the government generates huge revenue from it.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Source: Financial Express