India produced record sugarcane to the tune of over 5,000 lakh tonne during the 2021-22 season, the Ministry of food and public distribution said in a release.

Of the total produced during the period, about 3,574 lakh tonne of sugarcane was crushed by sugar mills to produce about 394 LMT of sugar (sucrose) — of which 36 LMT sugar was diverted to ethanol production and 359 LMT sugar was produced by sugar mills, the ministry said.

The year 2021-22 has proven to be a watershed season for the Indian sugar sector. All records of sugarcane production, sugar production, sugar exports, cane procured, cane dues paid and ethanol production was made during the season.

India is now the world’s largest producer and consumer of sugar and the second-largest exporter of sugar after Brazil.

In every sugar season, the production of sugar is around 320-360 Lakh Metric Tons (LMT) as against the domestic consumption of 260-280 LMT which results in a huge carry-over stock of sugar with mills.

“Due to excess availability of sugar in the country, the ex-mill prices of sugar remain subdued resulting in cash loss to sugar mills. This excess stock of about 60-80 LMT also leads to blockage of funds & affects the liquidity of sugar mills resulting in accumulation of cane price arrears,” the ministry said in a release.

With a view to preventing cash loss to sugar mills caused due to subdued sugar prices, the government in June 2018 introduced the concept of Minimum Selling Price (MSP) of sugar and fixed the MSP of sugar at Rs 29 per kg which was subsequently revised to Rs 31 per kg in February 2019.The release said the timely intervention of the central government over the last five years has been crucial in building the sugar sector step-by-step from taking them out of financial distress.

Among the interventions, as a long-term measure to enable the sugar sector to grow as self-sufficient, the central government has been encouraging sugar mills to divert sugar to ethanol production and also to export surplus sugar so that sugar mills may make payment of cane dues to farmers in time and also mills may have better financial conditions to continue their operations.

“With success in both the measures, the sugar sector is now self-sufficient with no subsidy for the sector since SS (sugar season) 2021-22,” it said.

During 2021-22, revenue of more than Rs 20,000 crore has been made by sugar mills or distilleries from the sale of ethanol, which has also played its role in the early clearance of cane dues of farmers.

“Another shining highlight of the season is the highest exports of about 110 LMT that too with no financial assistance, which was being extended upto 2020-21. Supportive international prices and Indian Government Policy led to this feat of the Indian sugar industry,” it added.