Sugar industry sees support price up a third

The sugar industry is expecting the government may raise sugarcane price by as much as a third to 109 rupees per 100 kg for 2009/10 crop to promote cane cultivation, two senior industry officials said.

"The government will try to promote the cane cultivation. It may increase the price to 109 rupees," said a senior industry official, who declined to be named.

The support price was 81.18 rupees for the 2008/09 season.

Raising prices is a key step to encourage sugarcane cultivation after farmers shifted to other higher-priced crops, affecting sugar output and making India a big importer from global markets.

Traders forecast a 45 percent drop in India's sugar output to 14.7 million tonnes in the crop year to September.

SOURCE: reuters