El Nino could affect wolrd sugar surplus

Unusual weather in India and the world, and the El Nino threat this year, which could affect rainfall patterns across the globe, is likely to end a period of sugar surplus. Reports confirms, after three straight years of big surpluses, the sugar market is heading towards a balance or a small deficit next season due to adverse weather in Asia and Brazil. A higher than expected Chinese demand and steady growth in consumption are other attributed reasons.

The International Sugar Organization(ISO) recently said that a more balanced sugar market looks likely in 2014-15 after successively smaller global surpluses in 2012-13 and 2013-14.

“A lot of the weather problems that we are encountering now are going to have a bigger effect on production next year. And an El Nino could further curb the output”, says Robin Shaw, an analyst at Broker Marex Spectron, world's largest privately owned firm of brokers for financial products in the commodities sector.

Weather in India and the production of Sugarcane

India accounts the largest area under cultivation of sugarcane in the world and is the world’s second largest producer of the crop next only to Brazil. Cultivation of sugarcane in India dates back to the Vedic period.

Changes in weather in India, i.e. the prospects for a poor monsoon season, due to the El Nino phenomenon could lead to less cane produce next season. Monsoon in India is an important driver of Indian sugarcane yields, and a drier than normal monsoon this year would result in lower sugar production.

In the agriculture sector, sugarcane shares about 7% of the total value of agriculture output. Maharashtra is the largest producer of sugar in India and contributes about 34% of sugar in the country followed by Uttar Pradesh, Bihar, Haryana and Punjab, which cover over 55% of the total cane area in India.

The sugarcane productivity and juice quality are profoundly influenced by weather conditions. Sugarcane is cultivated in the tropics and subtropics in areas with plentiful supply of water, for a continuous period of more than six to seven months each year, either from natural rainfall or through irrigation. A total and adequately distributed rainfall between 1100 and 1500 mm is considered best for surplus sugarcane production.

Some of the major causes of low sugarcane yields in India, other than problems like lack of fertilizers, inadequate irrigation, poor varieties of cane and backward methods of cultivation, are uncertain and erratic weather events.

Weather patterns could surely have a big effect on the production outlook of sugar, however it is too early to quantify the negative effects of El Nino on global output of the crop.

Photo by msn.