UPDATE 1-Trade body cuts Indian sugar output estimate 7% to 34 mln tonnes


Output down from previous forecast of 36.5 mln


Maharashtra’s output could fall to 12.1 mln tonnes


Lower output not providing scope for more exports - dealer

(Adds details, dealer’s quote)

MUMBAI, Jan 31 (Reuters) - India is likely to produce 34 million tonnes of sugar in 2022/23, down 7% from the previous forecast, as sugar cane yields in major producing states fell due to weather conditions, a leading trade body said on Tuesday.

Lower sugar output could limit exports from the world’s second-biggest exporter, lifting global prices, and allowing rivals Brazil and Thailand to increase their shipments.

The production estimate has been revised based on field visits, the current trend in per hectare sugar cane yields and sugar recovery rate, the Indian Sugar Mills Association (ISMA) said in a statement.

The trade body was earlier expecting India to produce 36.5 million tonnes in the current season ending on Sept. 30, surpassing last year’s record output of 35.8 million tonnes.

Total production is likely to fall due to the drastic reduction in Maharashtra’s output.

The western state, the country’s biggest sugar producer, is likely to produce 12.1 million tonnes in the current season, down from last year’s 13.7 million tonnes, ISMA said.

Sugar mills in Maharashtra are set to stop cane crushing 45 to 60 days earlier than last year as heavy rain has curtailed availability, state sugar commissioner Shekhar Gaikwad told Reuters last week.

The neighbouring southern state of Karnataka’s output could fall to 5.6 million tonnes from last year’s 6 million tonnes, the trade body said.

Reuters was first to report in December on the likely drop in production.

“The government had said it will decide allowing additional export based on the production. The revision in production number is not providing scope for additional exports,” said a Mumbai-based dealer with a global trade house.

India is not looking at allowing more sugar exports, government and industry officials told Reuters earlier this month. It has allowed exports of 6.1 million tonnes in the current season, after exporting a record 11.2 million tonnes in the previous season. (Reporting by Rajendra Jadhav and Mayank Bhardwaj; Editing by Louise Heavens and Sharon Singleton)