India is witnessing substantial developments in its sugarcane and ethanol production, which are poised to impact global sugar markets. In Andhra Pradesh, a potential reduction in sugar output may occur due to a Voluntary Retirement Scheme in cooperative mills. Concurrently, India’s oil marketing companies are seeking significant ethanol purchases, likely diverting resources from sugar to ethanol production. In Bihar, despite a sugarcane price hike, farmers are discontent due to delayed payments, potentially disrupting sugar supply chains.
Policy shifts in Bihar and capacity expansions in Uttam Sugar Mills reflect a trend favoring biofuels. Internally, Uttar Pradesh’s continued high sugar output could pressure prices downwards, potentially influencing India’s export strategies.
Brazil’s NDVI crop health bulletin for January 2024 indicates mixed trends, with some regions such as São Paulo showing lower than average NDVI values, while others like Paraná suggest healthier crops. Similarly, Thailand reports varied NDVI readings, with some areas demonstrating deviations from long-term averages, which could lead to unpredictable yields.
China’s NDVI values also show deviations in major sugar-producing regions like Guangxi, Yunnan, and Guangdong, indicating potential yield challenges. Australia’s data presents a slightly positive outlook for Queensland.
Crop health in other Indian regions presents a mixed picture, with Gujarat and Bihar differing significantly from historical NDVI values. The concerned deviation in Uttar Pradesh could hint at a potential risk of decreased yield.
Brazil’s Center-South region shows a notable increase in sugar cane harvest and ethanol production for the 2023-2024 cycle, with significant growth compared to the previous year. The demand for ethanol, particularly hydrated ethanol, is strong, with a significant surge in sales in early 2024 and corn ethanol production witnessing a dramatic rise.
Internationally, India plans an 8% increase in the Fair and Remunerative Price (FRP) of sugarcane to encourage production, despite a potential sugar shortfall due to poor rainfall. The Indian Sugar & Bioenergy Manufacturers Association (ISMA) has requested permission for increased sugar diversion for ethanol production, arguing that it will not impact sugar supplies and emphasizing incentives for ethanol production from maize.
Bangladesh intends to import 50,000 tons of sugar from India, aiming to secure supplies before Ramadan, reflecting regional trade adjustments based on crop output and policy changes.