Sugar consumption in the country will remain disrupted in coming months as lockdown measures have been extended amid coronavirus pandemic, according to a new report by Care Ratings.
Between October 2019 till mid-May, sugar output plunged by 18.9 per cent to 26.5 million tonnes led by a sharp decline in sugar production of major states.
In the same period, Maharashtra's sugar production fell by 43.2 per cent to 6.1 million tonnes followed by Karnataka where output tumbled by 21.8 per cent to 3.4 million tonnes. Drought in these primary sugar producing states affected the overall production.
However, sugar production in Uttar Pradesh clocked the highest level of 12.2 million tonnes during the period with a rise of 4.7 per cent year-on-year.
Care Ratings said sugar sales were higher by about one million tonnes during the first five months (October 2019 to February 2020) of the current sugar season.
However, sugar sales were affected in March and April as sales were lower by one million tonnes due to lockdown situation, thus offsetting higher sales of sugar during the initial period of sugar season.
Besides, international sugar prices have remained under pressure since the past two months.
The price of white sugar in London decreased to average in the range of 319 to 341 dollars per tonne and that of raw sugar in New York declined to be in the range of 10 to 11 US cents per lb March 21 onwards.
Care said the tremendous spread of Covid-19 across the globe that resulted in partial and complete lockdown in many nations. This in turn affected the global sugar demand that comes from bulk consumers like restaurants and eateries among others.
Notably, back in India, the lockdown measures were relaxed during the third and fourth phase. Under the latest phase, the government has allowed restaurants to operate kitchens for delivery of food items which is expected to increase consumption of sugar by these bulk consumers.
Overall, said Care Ratings, the consumption of sugar is expected to remain disturbed for some months now as bans on celebrations and gatherings continue.