0.9 million tons sugar shortfall likely

Sugar production stood at 2.575 million tons as the crushing season for the year 2005-2006 has come to an end with all sugar mills have reportedly been closed down.
The production as it stands was alarmingly less than the estimates and there is no doubt that alarm bells have started ringing for authorities.
Sugar consumption in the country was estimated at 3.7 million tons against production figures of 2.575 million tons. With buffer stocks, total stocks available to meet domestic requirement stood at 2.8 million tons.
Thus a shortfall of around 0.9 million tons is likely and import is the only option to fill the gap.
Low production is attributed on three counts: less plantation; sharp fall in per acre yield/recovery; and consumption of huge quantity of sugarcane for making gur.
Sources said the industry had estimated sugar production at slightly below 3 million tons. Policy-makers remained optimistic, as usual, though without any solid reasons in support of their arguments. They contested the industry's figures and estimated production of 3.2 million tons. However, actual output has proved all the estimates were wrong.
Industry sources said frost and gur making played key role in keeping domestic production below 2.6 million tons. They said frost damaged a substantial portion of the crop in Punjab that reduced yield and recovery drastically. Gur making gave the new height to its commercial trade this year.
Sources said around 0.125 million tons sugar could be produced from sugarcane that was consumed by commercial gur makers this year.
Rising trend of gur making is extremely dangerous. It seriously hurt the industry this year by consuming its share of sugarcane crop and if corrective measures are not taken it would dent the industry even more hardly in coming years.
This year crushing season was different in many ways. It widened the gap of mistrust between the industry and the government. It gave new height to unregistered buying of sugarcane that subsequently resulted in huge tax evasion.
After all it turned 2005-06 a year of windfall profit for the industry.
It exposed government departments' apathy in not checking rising sugar prices, subsequently multiplying consumers' sufferings.