Due to the effects of the El Niño weather phenomenon, sugar production is expected to decline next season in India, the world’s second-largest sugar-producing country.
Read also: UN warning on El Niño: Why 2027 is expected to be the hottest year on record
Where will sugar production stand in September?
Gross sugar production may range between 29 and 31 million tonnes annually by September 2027, while output for the current season is estimated at 31 million tonnes, according to forecasts from the Indian Sugar and Bio-energy Manufacturers Association.
The intensifying weather phenomenon is expected to devastate harvests across Asia, contributing to a global deficit of approximately 260,000 tonnes, the International Sugar Organization has warned. Monsoon rainfall affecting India’s sugarcane crop is currently running roughly 15% below normal. At the same time, according to Bloomberg, expectations of reduced output during the next harvest period have already driven raw sugar futures up by approximately 30% this year on the New York commodity exchange.
Prevention measures
India, the world’s largest consumer of the sweetener, last month allowed mills and refineries to import duty-free raw sugar in order to curb record domestic prices. The government also introduced limits on the quantities of stockpiles that traders and large consumers are permitted to hold.
“The country may need to import sugar next year to boost its reserves,” said Yatin Wadhwana, director of advisory firm Gradient Commercial, noting that current prices are likely to encourage factories to produce more sugar rather than ethanol.
