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By:

Rajendra Joshi

3 December 2024 at 9:20:26 am

Centre pushes for early sugarcane crushing

Mills seek special subsidy Kolhapur: Despite an estimated 30-40 lakh tonnes of sugar being available in excess of domestic demand, the Centre is stepping up efforts to keep sugar prices under control. The Union Food Ministry has urged Maharashtra, Uttar Pradesh and Karnataka to advance the 2026-27 sugarcane crushing season so that fresh sugar reaches the market before the existing stock is exhausted. Sugar mills, however, say an early start will come at a cost. They are seeking special...

Centre pushes for early sugarcane crushing

Mills seek special subsidy Kolhapur: Despite an estimated 30-40 lakh tonnes of sugar being available in excess of domestic demand, the Centre is stepping up efforts to keep sugar prices under control. The Union Food Ministry has urged Maharashtra, Uttar Pradesh and Karnataka to advance the 2026-27 sugarcane crushing season so that fresh sugar reaches the market before the existing stock is exhausted. Sugar mills, however, say an early start will come at a cost. They are seeking special financial assistance to compensate for the likely fall in sugar recovery and the reduction in cane weight that could result from crushing in October. India produced around 280 lakh tonnes of sugar last season. The season began with stocks of nearly 50 lakh tonnes, while annual domestic consumption is estimated at around 280 lakh tonnes. With about 35 lakh tonnes expected to remain in stock by September 30, the Centre wants the new season’s production to start flowing into the market without waiting for the traditional crushing cycle. Maharashtra, Uttar Pradesh and Karnataka account for nearly 80 per cent of India’s sugar production. The Union Food Ministry has therefore written to the chief ministers of the three states, asking them to bring forward the start of the 2026-27 crushing season. The push comes against the backdrop of a sharp movement in sugar prices. Ex-mill prices had earlier climbed to around Rs 68 per kg, pushing retail prices close to Rs 80 per kg. Following a series of measures by the Centre, ex-mill prices have since declined to around Rs 41 per kg. Yet, the government is looking at further measures to bring prices down and ensure that stocks move into the market. One such measure has been the approval of imports of one million tonnes of raw sugar. Since initial applications covered only around eight lakh tonnes, the Centre has invited applications for the remaining quota. It has also reduced the permissible stockholding limit for traders from 400 tonnes to 200 tonnes. The next major point of discussion will be the meeting convened by Union Food and Public Distribution Secretary Sanjeev Chopra with the sugar industry in New Delhi on September 8. The secretaries of Maharashtra, Uttar Pradesh and Karnataka have also been invited. West Indian Sugar Mills Association (WISMA) president B. B. Thombre said the Centre was pushing for crushing to begin around the middle of October. Traditionally, most mills in Maharashtra begin operations around November 15, largely because sugarcane harvesting labour becomes available only after Diwali. The industry is, however, willing to explore an early start between October 20 and 25. But early crushing could have significant implications. According to Thombre, sugar recovery could fall by around 1.5 percentage points, while the weight of sugarcane supplied by farmers could decline by 10-15 per cent. The industry will therefore seek special assistance for cane crushed between October 15 and November 15. At the September 8 meeting, it plans to demand a subsidy of Rs 500 per tonne for sugar mills and Rs 300 per tonne directly for sugarcane farmers.

This Diwali is about Defence Funds

The Nifty India Defence Index, which tracks the progress of defence-related companies listed on the stock exchange, has delivered a compounded annual growth rate of 26.8 per cent over the last five years, surpassing the broader Nifty 50 benchmark. However, this index has recently experienced a significant downturn from its 52-week high. The Nifty India Defence Index reached its peak of 8,302 on July 11, following which it saw a steep decline. At present, this index is trading at 6,808, showing a decrease of nearly 27 per cent from its all-time high.


Except for one company, Zen Technologies, all other constituents of the index are down from their all time highs, ranging from 15-50 per cent. We think the recent decline is due to overvaluation. The fundamentals of defence companies remain solid. The drop in stock prices has led to Mutual Funds like the Motilal Oswal Nifty India Defence Index Fund being offered at discounted rates. The Mutual Fund’s Net Asset Value (NAV) for the Regular Plan is currently trading at Rs. 7.94.


Defence Mutual Funds are made up of companies primarily involved in research, development, manufacturing, or selling products and services related to defence and military operations. They fall under the category of thematic mutual funds, providing investors with a chance to be part of a sector crucial to national security and benefiting from government defence spending. The defence sector’s financial foundation is stronger than ever, given the continuous rise in India’s defence budget year after year.


The defence sector in India is on the rise, with defence production revenue exceeding Rs. 1 trillion, marking a notable increase from the previous year. The ‘Make in India’ initiative and the push towards Aatmanirbhar Bharat in defence manufacturing are expected to boost the sector’s growth. Considering the long-term prospects of the defence sector, we see potential in Defence Mutual Funds. Investing through SIPs in defence funds can lead to decent returns over the next 3-5 years. It’s advisable for investors to avoid making large lump sum investments and instead opt for SIPs.

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