With national elections in progress, the mood in the country is upbeat. Most polls are predicting a change of guard. Reflective of the mood and central bank measures, Rupee has shown some appreciation.

Not much has changed on the fuel ethanol front, the conflict between Oil Marketing Companies (OMCs) and sugar mills continues. In the latest development, OMCs have ignored prices tendered by sugar mills and have set a fixed price. Despite this development, we remain positive on the sector as deliveries, while lower than mandated, are at record levels. We believe that the new Government would take right measures and would step in to address this latest setback.

Quarter ended 31 Mar saw a total export of 44.4 Mn litres of ENA and 7.3 Mn litres of other alcohol. In the quarter prior to this, these figures stood at 33.2 Mn litres and 11.3 Mn litres respectively. With sugarcane harvesting season just coming to a close and milling operations being in full swing, I expect export volumes to sustain at these higher levels in the current quarter. Prices are expected to remain firm due to demand pressures and high input costs.

Shekhar Swarup
Executive Director
ss@globusgroup.in

India News

Ethanol blending goes for a toss due to poor response from sugar mills

Feb 25: The Centre’s programme to blend five per cent of petrol with ethanol with petrol is facing trouble, thanks to the poor response from sugar mills. Oil marketing companies (OMCs) had floated tenders twice, inviting mills to supply ethanol. Read more

Oil companies set benchmark price for ethanol buy

Jan 20: State-run oil companies have set a benchmark price for procuring ethanol for blending with petrol, drawing protests from supplier sugar mills. The development threatens to further delay India's initiative to cut dependence on fossil fuels. Read more

Praj Industries to set up first commercial agricultural waste-based ethanol plant

Jan 16: Pune-based Praj Industries will set up the first commercial demonstration plant of ethanol production using agricultural waste by the end of 2014. The company plans to set up total two commercial demonstraion plants in Maharashtra while one site will come up overseas. Read more

India likely to consume 373.5 million cases of spirit by 2017

Mar 10: Spirits consumption is also likely to increase in the next five years to 373.5 million cases, an increase of over 20 per cent from 2013 level, said a study by Vinexpo. Wine consumption in India is likely increase to 2.1 million cases by 2017, 73 per cent higher than 1.21 million cases in 2013, said a survey. Read more

Officer’s Choice, Royal Stag in $1 billion club

Mar 20: Two Indian whisky brands — Royal Stag and Officer's Choice — soaked in $1 billion in retail sales last calendar, keeping growth rates intact despite spiraling prices influenced by tax hikes, according to industry research and company data. Read more

'Scotch prices in India may come down post FTA with EU'

Feb 13: Scotch whisky prices in India are likely come down after successful conclusion of free trade agreement with European Union, a top official of Scotitsh investment and trade promotion agency SDI said. Read more

India’s sugar production projection lowered to 23.8 million tonnes

Mar 7: India, the world’s second-largest sugar producer, is expected to produce 23.8 million tonnes (mt) of sugar in the current sugar year, which is just about enough to meet the country’s consumption of the sweetener. Read more

India Ratings revises outlook on shipping industry to stable from negative

Mar 6: Mumbai: India Ratings and Research Pvt. Ltd on Thursday revised its outlook on the shipping sector for the next fiscal to stable from negative on grounds that the credit profile of Indian shipping companies is unlikely to deteriorate further as freight rates stay stable. Read more

India Unexpectedly Raises Rate as Rupee Risks Inflation Goal

Jan 28: Governor Raghuram Rajan boosted the repurchase rate to 8 percent from 7.75 percent, the Reserve Bank of India said. “The gravest risk to the value of the rupee is from CPI inflation, which remains elevated close to double digits,” Rajan said in a statement. “It’s only by bringing down inflation to a low and stable level that monetary policy can contribute to reviving consumption and investment in a sustainable way.” Read more

Rupee outlook: Positive sentiment to support rupee

Mar 30: The upside risks seem limited and the Rupee is expected to trade in a range of 60-62 against the dollar in the medium term. In the short term, there could be intermittent spikes below 60 on the back of large capital flows. Read more

Sugar Output Likely to Fall by 10-15%
(January, 2014, Vol:XIV Issue:1)

As the impasse between the government and millers continued in Uttar Pradesh, analysts said India’s sugar output in 2013-14 could drop 10-15 percent on a year ago if crushing did not start in 15 days. In Maharashtra and Karnataka, too crushing has not started, as the farmers are demanding a higher cane price. Read more

Cane FRP Raised by Rs 10 Per Quintal for 2014-15
(March, 2014, Vol:XIV Issue:3)

The Cabinet Committee on Economic Affairs (CCEA) on Thursday approved a proposal to raise the benchmark price of sugarcane by R10 to R220 per quintal for the next marketing year starting October. Read more

Globus Watch

Globus enhanced its aggregate bulk alcohol production capacity by 42 million litres in fiscal year 2012-13. The new plants are on stream and running at full capacity. Using the advanced multi-pressure distillation technology, product quality remains impeccable and has received acceptance from premium liquor makers worldwide.

The Company successfully raised funding from Templeton Strategic Emerging Market Fund by issuing Cumulative Compulsorily Convertible Preference Shares valued at $13 million. The funds will be utilised for expansion in the under-penetrated East India region.
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