Sucheta Dalal :Rana Sugars see 27% less capacity use this crushing season
Sucheta Dalal

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Rana Sugars see 27% less capacity use this crushing season  

January 15, 2010

Sugar manufacturer Rana Sugars Ltd on Friday said that the actual utilisation of its cane-crushing capacity would be 27% less than its installed capacity in the ongoing crushing season because of acute shortage of cane.


"Due to low availability of cane, we expect the utilisation of our current cane-crushing capacity will remain underutilised in this (ongoing) season," Rana Sugars managing director Rana Inderpratap Singh told PTI in Chandigarh.


"The company will be able to crush only 11,000 tonnes of cane per day against the installed capacity of 15,000 tonnes per day," Mr Singh said.


Chandigarh-based Rana Sugars, a listed entity, has three manufacturing facilities, two in Uttar Pradesh and one in Punjab with total capacity of 15,000 tonnes of crushing per day.


Against the average crushing season of 100 days, Rana Sugars is anticipating the season to last just for 75 days. "Considering the acute shortage of cane, I do not think sugar mills will operate more than 75 days," he said.


The company is also expecting a major jump in cost of production this season in view of falling recovery rate and rising payout to cane growers for running mills.


"This year, we think our input cost will rise to Rs35-Rs36 per kg against a level of Rs23-Rs24 per kg last year," he said, adding, "It will mainly happen due to decline in recovery rate which is expected to be at 8.5% this year against 10% achieved last year," he said.

— Moneylife Digital Team


-- Sucheta Dalal