EID Parry JV to Begin Sugar Production This Week

EID Parry JV along with Cargill Inc., the largest U.S. agricultural company, will begin sugar production at its first Indian refinery this week. Silkroad Sugar Pvt will process 450,000 metric tons of the sweetener in the first year and 700,000 tons in the second, according to Jonathan Drake, head of closely held Cargill’s U.S. business. The plant, in Kakinada, Andhra Pradesh state, has a design capacity of 1 million tons. 
 
Now EID Parry JV will profit from a shortage of sugar in India which is forecast at 7 million tons this year. It will import raw sugar from Brazil and sell refined product in India. The refinery is going to be cost-competitive to supply to the world market as well. The project is port-based and the only one in India which is on natural gas.
 
A global sugar deficit may widen 43 percent to 11.92 million tons in the season ending April 30, up from the 8.32 million-ton shortfall forecast in October, according to Switzerland-based Kingsman SA. Raw sugar reached a 29-year high on Feb. 1 after more than doubling in 2009 as adverse weather curbed production in Brazil and India, the top producers. 
 
Commissioning of the Cargill refinery, originally planned for 2007, took longer than intended because of delays getting approvals. The company invested $100 million in the plant, which can also produce 33 megawatts of power. The venture will sell about 25 megawatts of surplus power to the state electricity board. Silkroad will use natural gas produced by Reliance Industries Ltd. from the Krishna Godavari basin.