The International Sugar Organisation (ISO), London has warned that sugar is going to be in even shorter supply than forecast this year as global output falls. This is because of the lower output in India, Thailand, Brazil and the European Union.

The ISO said it expected the global sugar output of 166.80 million tonnes in 2015/16, down from 171.20 million tonnes in 2014/15. Production in 2015/16 is expected to be the third consecutive season of a shrinking global output. For the first time since 2008/09, the production fall is so pronounced as to exceed 4 million tonnes.

The ISO expects a global consumption of 171.9 million tonnes in 2015/16, compared with 168.9 million tonnes in 2014/15. Analysts are scaling back sugar output forecasts for India and Thailand because of drought-eroded yields, increasing the likelihood of upward revisions to global deficit forecasts for the 2015/16 season.

According to a media report, sugar mills in the Indian state of Maharashtra, which typically operate between November and April, have started closing down earlier than usual as the first back-to-back drought in nearly three decades hit cane supplies in the country.

The early closure of mills in the sugar-producing state indicates the world’s total output and exports this year could come under pressure, under pinning global prices of the sweetener.

India is the world’s No 2 sugar producer after Brazil. Under these circumstances, Pakistan should export her surplus sugar stocks after ensuring that the interests of consumers, farmers and mill owners are safeguarded.

Khan Faraz
Peshawar

Published in Dawn, April 19th, 2016