Brazil may overtake India as top sugar grower in 2008-''09, says ISO

Mumbai: Brazil could soon win back the crown as the world''s top sugar producer from India, due to weather trends and a growing appetite for cane-based biofuel, the London-based International Sugar Organisation (ISO) forecast in its latest monthly report.

India, the world''s top sugar consumer, is set to overtake Brazil as the world''s top producer of the sweetener in 2007-08 (October/September).

The ISO predicted Indian output in 2007-08 at an all-time high of 33.15 million tonnes, up 8 per cent year-on-year. Indian consumption runs at about 20 million tonnes a year.

While the crop so far has been good aided by good monsoons, future monsoons may not be favourable to the crop. "Indian dominance is not for ever," said Sergey Gudoshnikov, a senior economist with the ISO.

The sharp fall in raw sugar prices, which have shed a fifth so far this year due to a global supply glut, will lead Indian farmers to plant alternatives, such as cereals and soybeans, for the 2008-09 crop, analysts said.

Last month, the ISO projected Brazilian sugar production in 2007-08 (October/September) at 32.38 million tonnes, up less than three per cent year-on-year.

India has exported 1.5 million tonnes of white sugar since January 2007, when a ban on overseas sales ended, the ISO said, quoting industry reports. Brazil, however, will remain the world''s largest exporter.

Analysts said India was not likely to remain the top sugar producer in 2008-09 because of the outlook for steady growth in the Brazilian sugar industry, as well as uncertainty over future monsoons and expectations of a huge buildup of stocks in India.