The margins of sugar mills are expected to come under some pressure from Q3 FY2018 onwards as the increase in cane costs for the coming crushing season will impact margins, a report said here. It is anticipated that sugar stocks will be around 4 to 4.5 million MT at the end of the forthcoming sugar season SY2018. Sugar production is likely to be around 24.5 million MT in SY2018, up from 20.3 million MT in SY2017. But increase in cane prices may result in some moderation in margins from Q3 FY2018 onwards, despite firm sugar prices. This is likely to increase the cost of production for sugar mills in RP-following states such as Maharashtra, Karnataka, Andhra Pradesh, and Telangana.

Source: dna July 27, 2017 13:07 UTC