India`s Sugar Production Declines 18% in 2024, Total Output Estimated at 26 Mt by Amit Gupta, Kedia Advisory
India's sugar production for the 2024-25 season has dropped 18.34% compared to last year, with total output expected to be around 26.1 million tonnes. The sugar industry has faced challenges with 18 sugar factories shutting down in recent weeks, impacting the crushing operations. Uttar Pradesh, Maharashtra, and Karnataka have seen considerable reductions in production, and the final figures for Tamil Nadu are also lower than expected. Meanwhile, a shift in production towards ethanol due to favorable sugar prices has impacted the earlier forecast for ethanol diversion. The National Federation of Cooperative Sugar Factories (NFCSF) has called for higher Minimum Selling Price (MSP) and better ethanol procurement prices.
Key Highlights
* India's sugar production drops 18% this season, estimated at 26 mt.
* 18 sugar factories have shut down, reducing crushing operations.
* Uttar Pradesh and Maharashtra account for the majority of production decline.
* Ethanol diversion has decreased due to higher sugar prices.
* NFCSF urges government to revise MSP and ethanol procurement prices.
India’s sugar production has seen a sharp decline in the 2024-25 season, with output falling by 18.34% compared to the previous year. As of April 30, 2025, only 25.7 million tonnes (mt) of sugar have been produced, down from 31.47 mt during the same period last year. The final figure is expected to be around 26.1 mt by the end of the season on September 30.
This dip in production comes as 18 sugar factories across the country have closed in the past fortnight. Uttar Pradesh, the largest sugar-producing state, has already concluded operations in 111 of its 122 sugar factories. The state’s output stands at 9.25 mt, down from 10.34 mt last year. Similarly, Maharashtra has seen a drop in production, with 199 out of 200 factories completing crushing, leading to a decline from 10.99 mt to 8.1 mt this year.
A major factor influencing sugar production is the increased diversion of sugar towards ethanol production, driven by favorable sugar prices. Initially, 5 mt of sugar was earmarked for ethanol, but now only about 3.5 mt is expected due to the continued profitability of sugar production. This shift has led to an additional 0.3 mt of sugar being produced, which would have otherwise gone for ethanol.
In response, the NFCSF has called on the government to revise the Minimum Selling Price (MSP) of sugar and increase ethanol procurement prices to ensure the sustainability of the sugar industry.
Finally,
The sugar industry faces challenges, but timely policy changes can help maintain sustainable production levels for both sugar and ethanol in the coming years
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