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  3. Sugar production likely to fall by 9.8% in FY’13: CMIE

Sugar production likely to fall by 9.8% in FY’13: CMIE

16 Apr 2012 Evaluate

The production of sugar is expected to fall by 9.8% in FY’13, as per the estimates put out by the Center for Monitoring Indian Economy (CMIE). The drop is expected as a result of a fall in the area sown under sugarcane production.  As per CMIE, the mounting cane arrears in 2011-12 are expected to make farmers turn to alternative crops leading to shrinkage in the area under sugarcane. The economic think tank had forecast 18% growth in sugar production in FY’12.

Because of the fall in sugarcane, the production of food products and beverages, in which sugar is a major raw material will see a minimal growth of 0.5% in FY’13 after estimated to have grown by a healthy 15.8% in 2011-12.

Output of molasses is also likely to fall, which is further expected to pull down the output of industrial alcohol. The production of soybean and mustard oil, which too are the key ingredients in food products and beverages, will fall in FY’13.

However, output of other manufactured food products and beverages like biscuits, instant food mixes, milk powder, beer, IMFL (Indian made foreign liquor) and aerated water and soft drinks is expected to go up by 2-8% in the FY’13.

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