SUGAR INDUSTRY IN INDIA

Submitted To : Ms. Dolly Pathak Submitted By: Sunita Dhankani Sonal Khare Takshi Lilaramani

INTRODUCTION
INDIA IS THE SECOND LARGEST COUNTRY IN TERMS OF SUGARCANE PRODUCTION 30% OF THE TOTAL SUGAR PRODUCED GOES FOR GUR AND KHANDARI , 45% GOES FOR SUGAR PRODUCTION AND THE 25% FOR ALCOHOL PRODUCTION (ETHANOL) 6 STATES CONTRIBUTE MORE THAN 85% OF TOTAL SUGAR PRODUCED IN INDIA SWOT ANALYSIS IMPORT AND EXPORT
  

INDIA PRODUCES 26 metric tones ON AN AVERAGE BUT THE PRODUCTION FOR THE FY09 IT IS EXPECTED TO GO BELOW BY 20%  GOLBAL CONTRIBUTION IS 3% BY INDIA, BRAZIL ALONE DOES 36% AND OTHER COUNTRIES GIVE A TOTAL OF 45% AND THE REST IS DONE BY CHINA, CUBA , INDONEASIA, THILAND, U.K AND USA  WORLD COUNSUMPTION OF SUGAR 150.3 MMT FOR 2007-2008, PROJECTED TO BECOME 160.7 BY 2010

INDIAN & GLOBAL SCENARIO

THERE ARE 453 SUGAR MILLS IN THE COUNTRY  252 ARE IN THE CO-OPERATIVE SECTOR  134 ARE IN THE PIVATE SECTOR  67 IN THE PUBLIC SECTOR  136 UNITS ARE IN THE IMPLEMANTATION STAGES  U.P PRODUCES 24% ALONE AND MAHARSHATRA CONTRIBUTES 20%  STATES AS TAMIL NADU, KARNATAKA, GUJRAT, PUNJAB  AND ALL THESE STATES CONTRIBUTE A TOTAL OF 85%

SUGAR CONTRIBUTION

INDIAN VIEW

AN OVERVIEW

SUGAR EXPORT
INDIA HAS AN AVERAGE EXPORTEABLE SURPLUS OF 6.23 million tones EVERY YEAR  THE PAST FIVE YEARS IT EXPORTED 4.07 million tones  SINCE DOMESTIC PRICES ARE HIGHER THAN INTERNATIONAL THE RATE OF EXPORT IS EXPECTED TO COME DOWN  THE MAJOR IMPORTING COUNTRIES OF INDIA ARE BANGLADESH, PAKISTAN, U.K, JAPAN,S.KOREA  AND THE NEW ONES ARE KHAZAKISTAN & IRAN

SWOT ANALYSIS
STRENGTHS  GLOBAL PRICES TO MOVE UP –AN INCREMENTAL POSITIVE  THE DEMAND IS EVERLASTING  ENVIRONMENTAL CONDITIONS SUITABLE FOR THE GROWTH OF SUGAR CANE  ABOUT 2.7% CULITVABLE LAND IS USED FOR THE CANE PRODUCTION  THE SUGAR INDUSTRY ALSO INCLUDES ALCOHOL, GUR AN KHANDRI WHICH IS MAINLY FOR THE DOMESTIC INDUSTRY

WEAKNESS  PRODUCTION TO DECLINE BY 20-25% IN FY09  SHIFT OF THE FARMER FROM CANE TO PADDY, WHEAT, PULSES AND OIL SEEDS  THE GREATER DIVERSION OF CANE TO UN-ORGANISED SECTOR  THE IGNORANCE IN THE RESIDUAL SUGAR MARKET  SOME OF THE GOVERNMENT POLICY THAT ADHERE THE GROWTH OF THE SUGAR INDUSTRY  SHORTAGE IN SUGAR CANE SUPPLY  OBSELETE TECHNOLOGY

OPPRTUNITIES  PRICES TO RISE BY 25% IN FY09 AND MORE IN FY10E  HIGHER MARGINS , LOWER CYCLICALITY DRIVING SHIFT TOWERDS INTEGRATION  THE ON GOING INCREASE IN DEMAND YEAR AFTER YEAR  THE SHIFT OF BRAZIL FROM WHITE SUGAR TO PRODUCTION OF ETHANOL

THREATS  LESS RAINFALL IN THE HIGHEST SUGARCANE CULTIVATING REGIONS  DUE TO WATER SHORTAGE THE SHIFT OF THE FARMERS TO MULTIPLE CROPS CULTIVATION  DUE TO GOVERNMENT POLICIES THE SELLING OF SUGARCANE BY THE FARMERS TO PRIVATE SECTORS  SUGAR PRODUCTION BEING MORE VOLATILE THAN CANE PRODUCTION  DUE TO RISE IN DOMESTIC CONSUMTION THE EXPORT IS LIKELY TO FALL

THE KEY PLAYERS IN SUGAR INDUSTRY
 BAJAJ

HINDUSTAN LTD. (ENTERPRISE VALUE: Rs mn 62,136)  BALRAMPUR CHINNI MILLS LTD. (ENTERPRISE VALUE: Rs mn 32,819)  SHREE RENUKA SUGARS LTD. (ENTERPRISE VALUE: Rs mn 43,283)

CONCLUSION
INDIA IS LACKING DUE TO ITS POLICY,METHODS,AND LACK OF KNOWLEDGE FOR THIS ONLY GOVERNMENT CAN MAKE A BIG CHANGE  INDIA INCLUDES SUGAR AS AN ESSENTIAL COMMODITY AN IT HAS BECOME MORE LIBERAL IN THIS SECTOR  INDIA HAS THE POTENTIAL TO BECOME THE WORLDS BIGGEST EXPORTER BY REMOVING THE MISSING LEADS.

THANK YOU

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