How Much Sugar Will India Produce This Year?
Presented By Tarun Kumar MBA 3A RollNo: 048


INDEX India·s Status as a sugar producer ´ Sugar contribution ´ World Sugar Balance ´ What·s happening now ´ Track Sugar : Logically ´ Track Sugar : Practically ´ Estimate frequently differ from reality ´ Last words ´ 2 .

INDIA¶S STATUS AS A SUGAR PRODUCER ´ ´ ´ ´ India is the second largest country Sugarcane production 6 states contribute more than 85% of total sugar produced in India 40% of the contribution to the GDP 3 .


3 million tonne for 2007-2008. raw value) value) Production Consumption 161.611 162.World Sugar Balance ‡ FAO report sharp shortfall of sugarcane in 2010.801 168. Projected to become 160. 2007/2008 2008/09 (min tonne.527 165. Brazil alone does 36% .7 by 2010 5 . raw (min tonne.241 Golbal contribution: 3% by India. Other Countries : 45% World consumption of sugar 150.

Compounded problem. This means prices would be high. Russia and China to import more sugar Traditional exporters Brazil and European Union don't have bumper crops. and foreign analysts 28 mn t. bad weather and floods will compel Pakistan. industry 25 mn t. Some market analysts say the gap could cross 2 million tonnes in the first half of 2011. sugar demand is rising faster than supply Sharad Pawar says output this year will be 22 mn tonnes.SO WHAT¶S HAPPENING NOW« ´ ´ ´ ´ ´ Globally. 6 .

Employees job is to visit fields in a 15-km arc and closely track crop progress from sowing to harvest.HOW DIFFICULT CAN IT BE TO TRACK SUGAR CANE : LOGICALLY ´ ´ ´ ´ India grows cane on just 5 million hectares (half the acreage of soyabeans) in mostly contiguous areas. 7 . All 400-odd mills have a cane department. L a r hundred employees focused on cane.

Their errors trigger a chain of inaccuracy.HOW DIFFICULT CAN IT BE TO TRACK SUGAR CANE : PRACTICALLY ´ ´ ´ Cane departments are the obvious place to accommodate friends and relatives of local VIPs These referral appointees are not desired expertise nor the desire to track crop. Government officials compound general lethargy with ignorance about the larger economic significance of their job 8 .

ESTIMATES FREQUENTLY DIFFER WILDLY FROM REALITY ´ ´ ´ In Feb. besides foreign suppliers and giant hedge funds trading futures in New York and London. the actual cane output and juice content far exceeded industry and government predictions When reality sank in. cola and food companies locked into high-priced contracts. traders. 9 . their shareholders. banks. the markets ² both local and overseas ² sank too from a 30-year-high This volatility hurt sugar companies.

The industry get sucked into sickness Taxpayers will have to eventually bail them out 10 . « « « « « Exports will become unprofitable Hedging is impossible without knowing the risk.. But suppose we produce 28 mn t and double exports.we could export 2 mn tonnes. That would keep global prices firm but steady. If we produce around 24mn t ² a bit more than our annual consumption . An unexpectedly large production. ´ ´ ´ After a good monsoon. The market would crash. India could be. the world·s second largest producer after Brazil.Sugar Sugar Sugar. Farmers won't get paid on time.

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