Sugar is one of the major food products that is widely used in India as well as other countries. It may be tempting to believe that we have a proportional advantage in producing the raw material for sugar – sugarcane – that would make us competitive in the export market as India is one of the world leaders in sugar production. The supply of sugar has improved its demand with production in some states such as Uttar Pradesh, Maharashtra, and Karnataka, keeping the prices under control. In this article, you would know the basic things to determine the sugar production and price of sugar.
A continuous rise in the price of sugar happens when the supply does not consistently keep pace with the demand. At that time temporary fluctuations may of course arise due to temporary factors like the halting of production during the Covid-19, a temporary drop in production such as in the cases of vegetables, or a seasonal jump in demand.
Sugar production in India
Sugar is an omnipresent product, being consumed, and more or less found almost everywhere in the world. As you know, India is the largest producer of sugar in the world together with Brazil. The sugar production of India will reach 35.6 million tons according to OECD-FAO Agricultural Outlook 2021-2030 report forecast. The report is also supposed to experience the largest increase in consumption growth, increased by higher demand for sugar-rich soft drinks and other products. Sugar is produced under a wide range of climatic conditions in around 120 countries including territories. It is derived from raw material sugarcane in temperate regions. Approximately 70% of the total production of raw sugars is from sugar cane.
The price of sugar depends on many factors
Generally in the short term, sudden price movements are interrelated with the gap in demand and supply. In recent years, the variations registered in market fundamentals do not necessarily reflect the amount of the price move backward and forwards that have occurred over the past two decades. The price of sugar today depends on the demand and the supply of sugar, with a view to protecting the interests of farmers.
At present, the world’s biggest exporter of sugar is Brazil (45%), followed by Thailand (13.5%), Australia
(5.6%), and India (4%). In India, the minimum price of sugar is ₹ 3,312 per quintal and the maximum is ₹ 3,770 / QTL.
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