Sugar mills in India's top producing state Maharashtra are set to stop cane crushing 45 to 60 days earlier than last year as adverse weather has curtailed sugar cane availability, a senior state government official told Reuters on Friday.
The western state of Maharashtra, which accounts for more than a third of the country's sugar output, could produce 12.8 million tonnes of sugar in the 2022/23 marketing year that began on Oct. 1, down from an earlier forecast of 13.8 million tonnes, Maharashtra's sugar commissioner Shekhar Gaikwad said.
Lower sugar output could prevent the world's second-biggest exporter from allowing additional exports, potentially supporting global prices, and allowing rivals Brazil and Thailand to increase their shipments.
"Excessive rainfall curtailed sugar cane's vegetative growth. This year lower cane is available for crushing," Gaikwad said.
A few mills in the central part of the state could start winding down operations in 15 days, and by the end of April all except three or four mills could have stopped crushing, he said.
On Thursday, raw sugar futures on ICE hit a one-month peak - above 20 cents per lb - on Thursday, boosted by technical momentum, India export jitters and upbeat sentiment in the wider financial markets. Cocoa and coffee also rose.
March raw sugar SBc1 settled up 0.57 cent, or 2.8%, at 20.68 cents per lb, having risen as far as 20.85 cents.
Dealers noted little selling appetite and said that, with sugar having closed above 20 cents on Wednesday, technical momentum should push prices higher in the near term.
The sweetener is also being boosted by widespread expectations that India's government will confirm a ban on additional sugar exports this season.