The apex sugar cooperative federation NFCSF has estimated that sugar production in the country next year   would be 24.5 million tonnes a little less than the current year’s production of 26 million tonnes.

The NFCSF Managing Director Vinay Kumar made the estimate public while talking with reporters in the capital.

However, Indian Sugar Mills Association (ISMA) had earlier calculated sugar output for the marketing year 2012-13 at 24 million tonnes. The sugar body said its estimate factored in a possible fall in sugar production due to a reduced precipitation.

According to the cooperative body, sugar output in Uttar Pradesh, the country’s second biggest sugar producing state, is estimated to rise to 8 million tonnes from 7 million tonnes in the review period.

Production in Karnataka is expected to decline to 3 million tonne on 2012-13 from 3.8 million tonnes this year due to less rains. Inspite of all this, India would have export surplus of 2 million tonnes for the next year, the sugar association noted.

UP chief minister Akhilesh Yadav has said in no uncertain terms that the sugar cane cooperative societies are important and their views are taken into consideration while fixing mill wise areas in the state.

The principal work of the cooperative societies is to promote the interests of farmers and ensure supply from member farmers but laissez faire policy would mess up things.

Reiterating his firm commitment to uphold the interests of farmers, Mr Yadav said de-regulation of the cane sector would expose farmers to serious difficulties as sugar mills would no longer be subject to any control.

The sugar mills could exercise their freedom in a negative way and their procurement could be skewed, he cautioned.

Mr Yadav was airing his views after his meeting with Prime Minister’s Economic Advisory Council Chairman Mr Rangarajan in the capital.

The end of intervention in the cane sector would spell a fierce price competition and the sugar mills could take undue advantage of their crushing capacity, Mr Yadav noted.

While talking about the foreign trade in sugar, Mr Yadav called for extension of special facilities to the mills of North India as they are far away from the sea ports.

The crisis of cooperative sugar mills has quickly developed into a big political issue in Uttrakhand.

BJP members of the state assembly have begun protesting the closure of a sugar mill and imposition of PPP model on the remaining sugar manufacturing units in the state.

While the govt defends its decision invoking the principle of economic viability, the opposition dubs it a sellout.

Sources say chief minister Bahuguna intends having talks with the opposition on the issue for an urgent resolution of the crisis.

The sudden closure of a cooperative sugar mill and infliction of PPP model on the remaining sugar mills in Uttrakhand has roiled politics in the state. The state BJP is incensed over the decision and has charged the Bahuguna govt with a sell-out.

The BJP has expressed fear that the secret deal the govt has entered into with businessmen would have the twin effects of profiting some politicians of the ruling party and forcing thousands of workers to face redundancy.

The party maintains that it does not oppose PPP model as such as it could be useful in the field of infrastructure. But its application in the case of sugar mills does not stand scrutiny, the party asserts.

Sources say the BJP leaders and workers have already started protesting the govt decision through meetings and demonstrations. They have also threatened to begin a state wide movement against the govt, the sources add.

Earlier Chief Minister had promised to discuss the issue with the BJP leaders but his sudden departure for Delhi has left the opposition party wondering if there is something seriously fishy about the deal.

Declining sugarcane production in the state has made the dynamic Chief Minister Manohar Parrikar announce incentives to the cane farmers if they increase the production by 15 per cent in next two years.

Parrikar told the state Assembly that the government is contemplating the possibility of giving more profits to the sugarcane farmers.

“Ten years back the sugarcane cultivation was spread over 1,200 hectares of land which has now reduced to 850 hectare. The production has gone down from 68,000 tonnes to 46,000 tonnes during the last decade,” Parrikar said.

The target for next two years is to achieve 75,000 tonnes of sugarcane production in the state, he said. State Cooperation Minister Dipak Dhavalikar told the Assembly that the Sanjivani Sugar Factory, which runs in Dharbandora village, will have difficulty to procure the sugarcane from the neighbouring state this year due to drought conditions there.

He said Goan sugarcane farmers will be given an additional 15 percent incentive, along with their cost of cultivation if the production of the crop increases.

Responding to a suggestion by Leader of Opposition Pratapsinh Rane to use the capacity of sugar factory to produce ethanol, the minister said the government can study the proposal.

Maharashtra Chief Minister Prithviraj Chavan has urged the Rangarajan Committee appointed by the Centrral govt to give its recommendations on sugar export policy, remunerative sugarcane price and levy sugar soon.

The committee is supposed to give a thorough and detailed report on various issues concerning the country’s sugar industry including the important issue of deregulation.

Accompanied by several of his senior cabinet colleagues Chief Minister Chavan met the committee chairman Dr C Rangarajan, Maharashtra govt sources were quoted as saying.

It is noteworthy that there   are nearly two hundred sugar factories in Maharashtra and an overwhelming majority of them are in the cooperative sector.  The industry boasts a turnover of several thousand crore providing millions of families the source of their livelihood. The workforce employed in the industry counts more than a million.

It is not without reason that the industry exerts a great amount of influence in the politics of the state.  It is generally believed that those exercising control over the industry would prevail in the power-politics  of Maharashtra.

The latest statistics show the country is likely to rake in a good amount of hard currency through an increased export of sugar this year.

India has already sold nearly 14 lakh tonnes of sugar abroad till March this year as opposed to about 28 lakh tonnes in the entire period of 210-11.

The govt shared the information in the Rajya Sabha on Monday.

Earlier, the govt had done away with quantitative restrictions on exports.

Incidentally, India is the second largest producer of sugar in the world.

Word has it that the sugar industry may soon go liberal. The government of India has set up a Committee to consider the issue of decontrolling the industry.

Sources say all the stakeholders will be asked to give their views and opinions and while formulating its recommendations the committee will factor in them.

However, the leading sugar organisations including National Federation of Cooperative Sugar Factories are in not in favour of a complete deregulation. A major part of sugar production in the country takes place through cooperatives with the state of Uttar Pradesh topping the chart.

They want partial decontrol. But they would like to have some freedom to sell sugar in the open market as well as get spared the burden of providing sugar for the PDS.

Ever since the RBI has given Maharashtra State Cooperative Bank a clean bill of health, the bank is bubbling with new ideas and plans.

It is so excited that it has decided to venture into wholly new businesses. It feels its work with sugar and spinning mills is over. It has maxed out on this sector.

MSCB has begun preparing itself for a large-scale diversification into corporate financing, information technology, manufacturing and engineering, infrastructure and energy.

MSCB officials say even if the bank is largely withdrawing from the conventional businesses, it would not stop helping fisheries, floriculture, sericulture and food processing in the cooperative sector.

India’s sugar production may reduce   by 5 percent in 2012-13 but the decline in production would not affect the country’s domestic market, international experts have said.

They have added despite a downward trend in production India could still be able to do export on a small scale.

However, India’s National Federation of Cooperative Sugar Factories estimates the country’s sugar production at 25 million tonne for 2011-12.

According to govt. officials, the prospects of sugar production are not as bad as they are being made out to be for higher area coverage encourages an optimistic view.

Sugar cooperatives are doing wonderful in Haryana and according to the State government officials cooperative  sugar producing units in the state have had a production of over a million quintals of sugar this crushing season.

This is being claimed as an achievement of the cooperative sector in Haryana. These units have even supplied more than 20 million units of electricity to the power installations in the state.

Officials say, the cooperative mills have smashed their own previous records in the sugarcane crushing this time round in the state.