Even as there is decrease sugar manufacturing because of poor rainfall in sugar season (SS) 2018-19, surplus scenario continued following excessive convey-over inventory from the last season, rankings agency India Ratings stated in its latest report.

Sugar production is in all likelihood to say no to around 30 million tonne in SS 2018-19 from the record high of 32.Three million tonne in SS 2017-18 due to poor rainfall, white grub and pink rot infestations inside the key cane generating states of Uttar Pradesh and Maharashtra, the employer stated.

Despite being decrease than the remaining season, production in SS 2018-19 is in all likelihood to exceed sugar demand of around 26 million tonne, it added.

With a high establishing inventory of 10.7 MT(2017-18: 3.9 MT), India is possibly to give up the season with a stock of around eleven MT (consisting of a buffer stock of 3 MT).

Adjusting for this buffer inventory, the stock-to -consumption ratio could exceed 30 percent as compared to the regular carry forward requirement of sixteen-18 percent, the file stated.

Meanwhile, Ind-Ra expects that the minimal aid fee (MSP) hike will push up the domestic wholesale charges to round Rs 33-34 in keeping with kg from the extent of Rs 31-32 consistent with kg that has been triumphing in view that November 2018.

This is possibly to enhance the EBITDA margins of millers.

The MSP hike is in general aimed toward addressing the difficulty of mounting cane arrears, which stood at Rs 20,two hundred crore as on February thirteen, 2019, according to the Indian Sugar Mills Association (ISMA).- PTI