Content ID

334665

Heavy rains to delay sugar cane crushing in top producer India

By Rajendra Jadhav

MUMBAI, Oct 12 (Reuters) - Heavy rainfall has spoiled Indian sugar mills' plans for an early start to cane crushing so raw sugar exports could get underway before supplies start coming on the market from rival exporter Thailand, a senior industry official and dealers said.

The delay in cane crushing in the world's biggest sugar producer and the second biggest exporter could push back shipments of raw sugar from India and may support global prices .

"The season is likely to get delayed by a fortnight since most cane growing areas are getting heavy rainfall," said Prakash Naiknavare, managing director of the National Federation of Cooperative Sugar Factories Ltd.

India has received 88% more rainfall than normal so far in October.

Western state of Maharashtra and neighbouring Karnataka, the country's biggest and the third-biggest sugar producing states, have had heavy rains, while the second biggest producing state of Uttar Pradesh got a heavy downpour last week.

The three states account for more than three-quarters of the country's sugar output.

Mills in Maharashtra were planning to start crushing in mid-October and produce raw sugar for the exports, said a Mumbai-based dealer with a global trading firm.

"Mills have already signed export contracts for November and December shipments. They would be under pressure to churn out raw sugar as early as possible after crushing starts," the dealer said.

The Indian government has not allowed exports yet, but traders have so far signed deals to ship around 1 million tonnes, mostly in November and December, dealers said.

The sugar-crushing season in Thailand, the world's third-biggest sugar exporter, usually starts in late November or early December.

Export contracts for white sugar can be executed with last season's output, but raw sugar stocks are not available with the mills, said a New Delhi-based dealer.

Indian mills traditionally produce white sugar for local consumption and make small amounts of raw sugar for exports. (Reporting by Rajendra Jadhav. Editing by Jane Merriman)

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