India's sugar output set to fall.

NEW DELHI: Sugar output in India, the biggest producer after Brazil, is set to decline in the year from October as domestic prices fall on cheaper imports and dry weather curbs planting, the Indian Sugar Mills Association said yesterday.

Production will probably slide from 24 million tonnes in the year ending Sept 30, M Srinivaasan, president of the association, said in a phone interview. Decreasing local prices will hamper mills' ability to make timely payments to farmers, encouraging them to switch to other crops, he said. He didn't give a forecast for 2013-2014.

A lower harvest after two years of surplus may spur the world's second biggest consumer to boost imports further, curbing a slide in New York futures.

"The domestic sugar situation right now is pretty bad," said Mr Srinivaasan. "We are going to have negative planting in consequence to that and also due to the drought situation in certain states. Imports are taking place too soon."


Source : businesstimes.com.sg