Industry leaders said that consumer demand for sugar had been affected due to lockdown and curfew restrictions amid surging covid claims. Prakash Naiknavare, MD, National Federation of Cooperative Sugar Factories (NFCSF), said that sugar millers are facing the heat with lessened liquidity and inability to fulfil payment of sugarcane farmers, which is reported to be approximately over Rs 23,000 crore.
“The situation is speedily moving towards replication of the first lockdown of March 2020. Back then, the lockdown of 100 days had slashed down sugar consumption by one million tonnes. Bulk consuming industries viz. beverages, ice-cream, chocolates, biscuits, sweetmeats, and sherbet are likely to cut down on their sugar purchases. Add to this the ban or restrictions on ceremonies and public functions would cut down sugar consumption,” he observed.
As a result of this natural disaster, the Indian sugar sector is staring at another scary business loss leading to financial stress and mounting cane arrears; Praful Vithalani, president, All India Sugar Trade Association (ASTA), agreed and sad that sugar consumption is set to fall for a second straight year after restrictions imposed on restaurants and sweet shops in various states. Vithalani said that purchases by bulk buyers have been falling, and the summer demand that usually improves from March to June has not kicked in yet.
Maharashtra, Rajasthan, Chhattisgarh, Delhi and Uttar Pradesh are among states that have imposed various curbs this month after a steep hike in Covid-19 cases. Mukesh Kuvediya, secretary-general, Bombay Sugar Merchants Association (BSMA), said that consumer demand has remained muted because of Covid and lockdown restrictions. Barring household consumption, the industrial market is shallow due to the uncertainty in the lockdown situation in several states. Demand for ice-creams and beverages is low, he said.