The earlier estimate of 120 tonnes was fixed around December last year.The cooperative sector will continue to be a major contributor to the increased production. Of the total 127.5 lakh tonnes, as high as 69.99 lakh tonnes will come from the cooperative sector and the balance from the private sector.

The stock position is likely to be comfortable at about 52 lakh tonnes as on September 30, 1998. Though the quantity seems to be good enough to meet the requirement of the early months of 1998-99, there will be a shortfall of about seven lakh tonnes during September, October and November. The changed weather scenario in Maharashtra, one of the largest producers of sugar in country (about 35 to 40 lakh tonnes), has made the difference and the sugar production has alreadycrossed last years' production of cooperative sector. During 1997-98, of the total 121 sugar cooperatives factories, 95 factories crushed 345.71 lakh tonnes of sugarcane to produce 38.55 lakh tonnes. The average recovery was 11.15 per cent.

Most cooperatives commenced crushing on schedule, starting in the first half of November, with the exception of about 24 cooperatives in Maharashtra, which did not undertake production in the current season due to financial problems and sugarcane shortages.

The sugar industry has already given a five lakh tonnes on loan to the centre last year. This quantity is yet to be returned. However, there hardly seems to be any chance of getting the loaned sugar back as the centre is already falling short of levy sugar. The National Federation of Cooperative Sugar Factories and Indian Sugar Mills' Association have suggested that the centre should procure the quantity from the free-sale pool instead of importing sugar. This will not only help the industry liquidate the excessivestock of free-sale but also enable them to pay sugarcane prices to the growers and discharge other obligations. Even after giving the required quantity, the opening stock of free-sale sugar during 1998-99 is likely to be at around 52 lakh tonnes, which is good enough to meet the internal requirement for about six months.

Ironically, the centre is yet to announce the levy sugar price for the year 1997-98 though the season was almost over. It is understood that the centre was thinking of making a negative adjustment for molasses realisation, which should be avoided. The government will have to announce the levy sugar price as it has caused serious cash crunch affecting the sugarcane price, said Narendra Borgaonkar, chairman of Maharashtra State Cooperative Sugar Factories Federation.

Sources said that the centre was likely to purchase around 12 lakh tonnes of sugar (including five lakh tonnes already taken) on the basis of average free realisation for the preceding three months or the sale of price of thecurrent month or landed cost of import.

In case of khandsari production, according to the industry sources, it would rise to 857,000 tonnes from last year's 807,000 tonnes. Cane diversion for the production of gur and khandsari during the first half of the marketing year was limited due to intermittent showers during the period of November through January. The return of more normal weather and a phenomenal rise in gur prices since February have led the gur and khandsari producers to produce cane more aggressively by offering competitive prices to farmers.