Sugar output seen 35 percent up in Indian state

Sugar output in India's biggest cane-growing state may rise upto 35 percent in the new season from October as farmers have planted more cane after getting record prices last year, a senior industry official said.
Hopes of an increase in output will prompt India, the world's top sugar consumer and the biggest producer behind Brazil, tax imports of the sweetener by September, when the government gets a clear idea about cane harvests for the new sugar 2010/11 season.
"Although rains have been a little less, I will not say that there is any harm to the crop.
Until now the crop is good and further rains will help," Shyam Lal Gupta, secretary general of the Uttar Pradesh Sugar Mills, told Reuters in an interview on Friday. Monsoon rains in the western parts of Uttar Pradesh have been 12 percent below normal since the four-month season began in June, according to the India Meteorological Department.
Gupta, also a director at the Indian Sugar Mills Association, said output would rise to 6.8-7.0 million tonnes, up from 5.2 million tonnes in the previous year. Higher output in Uttar Pradesh may help India become self-sufficient or export small quantities in 2010/11, putting further downward pressure on raw sugar prices in New York.
A Reuters poll on Friday showed that higher supplies from top producers Brazil and India was expected to tip the global market into surplus for 2010/11. The government had withdrawn the import tax of 60 percent on sugar in 2009 to overcome a shortage, triggered by lower cane output as last year's monsoon was the weakest since 1972. Large imports by India helped New York-traded raw sugar touch a 29-year high in February.
A senior official of the Uttar Pradesh cane department early this month said acreage under cane rose to 2.5 million hectares for the next season from October, up from previous year's area of 1.7 million tonnes. Last year's scanty rain and crop switching by farmers reduced cane planting in the state by 17 percent to 1.7 million hectares, trimming the country's sugar output that fell 44 percent to 14.7 million tonnes.