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Sugar mills worry over surplus, talk of ‘industry collapse’

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New Delhi, Oct 14 : With the availability of sugar set to reach an unprecedented level of 44 million tonnes thanks to huge unconsumed stock from last year and expected higher production this year, an imminent threat of “industry collapse” is being talked about. This has pushed mills to consider producing globally-accepted high-quality refined sugar as the most promising way to dispose off the surplus.

The decision of Brazil, the world’s largest sugar producer, to lower production this year has given Indian industry an opportunity to fill the space. However, it will have to live up to global expectations, the National Federation of Cooperative Sugar Factories (NFCSF) has said.

It said the mills are planning to boost their exports by improving quality of sugar to 45 ICUMSA grade, a high quality refined grade and considered one of the highest purity levels globally.

“Currently, we produce sugar whose grade is between 100-150 ICUMSA. Till now, the domestic consumption offset the domestic output. So Indian sugar mills never bothered about producing high refined quality sugar as per the global standards,” NFCSF Managing Director Prakash Naiknavare told IANS.

ICUMSA is a global body and its rating is an international unit for expressing the purity of the sugar, which is directly related to the colour of the sweetener.

Brazil has decided to cut down sugar production by earmarking more cane for manufacturing ethanol, so India finds a space where the domestic surplus can be accommodated.

“To achieve it, we will have to produce sugar of 45 ICUMSA grade. It will take minimal efforts and capital to upgrade the existing machinery,” Naiknavare said.

India has a surplus (opening stock) of 10.5 million tonnes from the last season and it is expected to produce around 33.5 million tonnes of the sweetener in 2018-19 starting October.

So the total availability of sugar this year will be around 44 million tonnes against the expected domestic consumption of 26 million tonnes, thus putting a “burden” on the mills to clear huge sugar stocks in the backdrop of depressed retail prices — around Rs 37 per kg in the national capital compared to around Rs 40-43 a year ago.

As the sugar output in Brazil is to go down by almost 10 million tonnes, India is set to become the largest sugar producer in the world this year.

Naiknavare said it was “a god-sent” gift, which had provided India “with an opportunity to make perception that India can be a great destination” for high-quality refined sugar.

As per the initial estimates of the Indian Sugar Mills Association (ISMA), which represents private sugar mills in the country, India is set to produce around 35 million tonnes in the 2018-19 season starting October against 32.25 million tonnes in the previous year.

The NFCSF, however, said that the 2018-19 production figures would be around 33.5 million tonnes owing to the infection of white grub in Maharashtra and Karnataka, which damages roots leading to the death of cane.

The government can store three million tonnes. It will also help mills to export five million tonnes under the Minimum Indicative Export Quota (MIEQ) by compensating expenses towards internal transport, freight handling and other charges.

“The government’s assistance and incentives have been helpful to the industry. Even if we take all these into account, including 26 million tonnes of domestic consumption, there will be surplus of 10 million tonnes. If it is not disposed, the industry will collapse,” said Naiknavare, adding all stakeholders, including the ISMA, had started brainstorming on how to dispose the surplus.

The government, while announcing a bail-out package for the industry in June this year, had fixed minimum selling price (MSP) at the mill gate of Rs 2,900 per tonnes to ensure that retail prices do not fall further.

The average price sugar received at global market in last 15 days is roughly Rs 2,200- 2,400 per tonne.

However, the prices have been on the increase from last few days — 10.97 cents per pound on September 28 to 13.11 cents per pound on October 9 according to the International Sugar Organisation — a trend the Indian sugar industry finds positive.

Acting on the industry’s request, the central government had given a subsidy of Rs 55 per tonne of sugarcane to help mills to clear cane farmers’ arrears.

(Saurabh Katkurwar can be contacted at [email protected])

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United States Employment Rate will fall further: Fed

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Washington, April 16 (IANS) Economic activity “contracted sharply and abruptly” across all regions in the US as a result of the COVID-19 pandemic, the Federal Reserve said on Wednesday.

“The hardest-hit industries – because of social distancing measures and mandated closures – were leisure and hospitality, and retail aside from essential goods,” the Fed said in its latest survey on economic conditions, known as the Beige Book, based on information collected from its 12 regional reserve banks before April 6, Xinhua reported.

“All Districts reported highly uncertain outlooks among business contacts, with most expecting conditions to worsen in the next several months,” the Fed said.

The survey showed that employment declined in all districts as the COVID-19 pandemic affected firms in many sectors.

“Employment cuts were most severe in the retail and leisure and hospitality sectors, where most Districts reported widespread mandatory closures and steep falloffs in demand,” the survey said, adding severe job cuts were also widespread in the manufacturing and energy sectors.

“Contacts in several Districts noted they were cutting employment via temporary layoffs and furloughs that they hoped to reverse once business activity resumes. The near-term outlook was for more job cuts in coming months,” the survey said.

The survey noted that no district reported upward wage pressures, with most citing “general wage softening and salary cuts” except for high-demand sectors such as grocery stores.

“These trends were seen as reflecting weaker demand for many goods and services in the wake of the COVID-19 pandemic,” the survey said.

The survey came after the Commerce Department reported earlier on Wednesday that US retail sales plunged in March by the most on record as the COVID-19 pandemic is starting to take a big toll on the US economy.

The US economy is expected to contract by 5.9 per cent this year, according to the World Economic Outlook (WEO) report released by the International Monetary Fund (IMF) on Tuesday.

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New York statewide COVID-19 deaths surpass 10,000

Meanwhile, indicators including the rates of ICU admissions and intubations have gone down and the three-day-average rate of hospitalization basically reached a plateau, according to the governor.

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New York, April 14 : Governor of the US state of New York Andrew Cuomo said statewide deaths from COVID-19 rose to 10,056, adding “the worst is over if we continue to be smart” in coping with the novel coronavirus.

Cuomo on Monday said at his daily briefing that a total of 671 people passed away on Sunday due to the disease, a number much lower than in the past few days, Xinhua news agency reported.

Meanwhile, indicators including the rates of ICU admissions and intubations have gone down and the three-day-average rate of hospitalization basically reached a plateau, according to the governor.

“We are controlling the spread,” said Cuomo. “I believe the worst is over if we continue to be smart. I believe we can start on the path to normalcy,” he said.

He said he would be joined by several other governors of neighbouring states later on Monday to discuss how to reopening the economy in a coordinated way.

On Twitter, the governor said that any plan to reopen society must be driven by data and experts, not opinion and politics.

He said the objective is to ease isolation and increase economic activity without increasing the infection rate.

“We will learn from the warning signs from other countries. We will take every precaution. We will work together as a region,” he added.

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US now has highest COVID-19 deaths, surpasses Italy: Johns Hopkins

A total of 20,071 people have died of the disease among 519,453 confirmed cases in the country as of 4 p.m. local time (2000 GMT) on Saturday

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Washington, April 12 : The UnS has surpassed Italy as the country with the highest number of coronavirus deaths in the world as the fatalities as of Sunday reached 20,604, according to data compiled by Johns Hopkins University.

As of Sunday morning, Italy has reported 19,648 coronavirus deaths, placing it in the second position after the US, the data published by the university’s enter for Systems Science and Engineering (CSSE) revealed.

The US also accounts for the highest number of confirmed cases with 529,887. Spain, where the number of confirmed infections stands at 163,027, is a distant second, followed by Italy with 152,271 cases.

New York state, the epicentre of the pandemic in the US, has recorded the most deaths in the country, 8,627, which is followed by New Jersey and Michigan with 2,183 and 1,276, respectively, the CSSE data showed.

A total of 32,001 patients in the country have recovered, it added.

US President Donald Trump’s administration, which earlier estimated that the pandemic would cause anywhere from 100,000 to 240,000 deaths in the US, revised its projection downward this week to 60,000, reports Efe news.

Members of the White House coronavirus task force credit the more optimistic forecast to the success of the stay-at-home orders issued by 42 of the 50 states, as well as Puerto Rico and the District of Columbia, covering around 316 million people.

Trump, who has repeatedly decried the economic cost of closing schools and businesses to contain the virus, said late last month that he hoped to re-open the country by Easter Sunday.

During Friday’s news briefing by the task force, Trump sought to reassure Americans that he would guided by medical experts as well as by recommendations from the “Opening Our Country Council” he plans to install next week.

“I want to get it open as soon as possible. The facts are going to determine what I do,” the president said.

“I’m going to have to make a decision, and I only hope to God that it’s the right decision. But I would say, without question, it’s the biggest decision I’ve ever had to make,” Trump said.

As of Sunday, the number of global coronavirus cases stood at 1,777,517, with 108,862 deaths, while 404,236 people have recovered.

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