Excess Supply of Sugar and promoting use in Biofuels – Explained, pointwise

Introduction

India is the largest consumer and the second-largest producer of sugar. There is excess and cheap availability of Sugar in India. The Government is taking proactive measures to boost the export of surplus sugar and divert the use of sugarcane to ethanol (Biofuel).

About Sugarcane crop

Sugarcane is grown as a Kharif Crop. It needs a hot and humid climate with an average temperature of 21 °C to 27 °C and about 75-150 cm rainfall. Sugarcane is a water-intensive crop.

Sugarcane can grow in any soil which can retain moisture, however deep rich loamy soil is considered ideal for sugarcane.

How big are global and India’s Sugar Industries?

Since the Second World War, many global commercial food and beverage manufacturers have used sugar to promote their products.

The Food and Agriculture Organization (FAO) estimates world sugar production in 2021-22 at 173.7 million tonnes. The global production was 49 million tonnes in 2000.

India is the second-largest producer of sugarcane after Brazil. In India, the largest sugarcane producing state in India is Uttar Pradesh, followed by Maharashtra, Karnataka, Tamil Nadu and Bihar.

Why are the reasons behind surplus supply of sugar?

Higher Returns

Farmers tend to grow more sugarcane due to its potential for generating higher returns over costs, about 60-70% more compared to most other crops. Refined white sugar is also cheap for consumers. Since it is valuable, in many countries, it receives government support (for instance, Fair and Remunerative Price (FRP) in India). It has thus become a priority crop. As in India and Brazil, many countries developed entrenched interests in growing sugar. With this backdrop, surpluses started to develop.

Decrease in consumption

Scientists and people have now realised the impact of excessive consumption of sugar and its lifestyle-related chronic health problems are an unavoidable global health issue. This is because,

1. There is a growing awareness among people that there are no health benefits to consuming more sugar. Instead, there is a major rise in obesity and related diseases alongside lack of nutrition. Children are also developing obesity and metabolic syndrome at an early stage. 2. Shift in calorie based diet to nutrient-based diet: In the second half of the 20th century, around the world, the focus of food security was just to ensure that people could get enough calories from the basic staple crops to enable a productive life. But now, people largely do have adequate calories — yet, there is a globally increased burden of malnutrition. This is because people don’t have adequate micronutrients and protein for sustained cognitive and physical growth.

For these reasons, the supply of sugar has outpaced its demand.

Why India should move away from more sugar production?

First, WWF estimates that 15 countries devote over 25% of their land area to sugarcane cultivation, clearing vast biodiversity-rich habitats, from tropical rainforests to seasonal groves.

Second, Sugarcane is heavily water-intensive. Studies in Maharashtra found that it can take up 60% of irrigation supply and impacts groundwater as well. In some sites, the water table has dropped from 15
metres to 65 metres in the last 20 years.

Third, Health impacts of Sugar: Along with other health impacts, diabetes is another cause of worry. While WHO finds diabetes quadrupling globally since 1980, the WEF terms this ‘a silent epidemic’, nearly thrice as deadly as Covid-19.

International Diabetes Federation and the Global Burden of Disease project predicts that about 98 million Indians could have diabetes by 2030.

Fourth, With increased sugar production, there is a dilemma in how to use such sugar surpluses while maintaining revenues for producers and avoiding declining prices. One such way to utilise the surplus sugar is to create a whole new demand. For instance, sugar could be used to make biofuel instead of food. Using sugarcane for biofuels can reduce both emissions and ill-health.

What is biofuel?

What are the advantages of using sugarcane for producing biofuel for India?

Biofuels made from crops can be used in the transportation sector as an alternative to fossil fuels. With climate change mitigations underway, India can lower its greenhouse gas emissions by limiting fossil fuels in the transport sector. Brazil already has a biofuel industry based on Sugarcane. The Government of India has also set a target that India’s transport sector should be at least 20% comprised of biofuels.

In India, molasses, a by-product of sugar manufacturing, is used to make biofuel. But if India can use sugarcane juice in biofuels, the whole commodity would be used far more productively and sustainably. To reach that E-20 mandate with molasses alone means a very large expansion of sugarcane cultivation is needed. This would also lead to a huge amount of extra sugar on the market. If sugarcane juice was used, then the E-20 mandate could be met without any massive production expansion and increasing sugar’s water and climate challenges.

What should be done?

Make sugarcane cultivation sustainable: Improvements in sugarcane farming can reduce water intensity significantly. For instance, In Mexico, by using water recycling, sugar’s water consumption fell by 94%. So, India can adopt such practices.

Implement a series of post-harvest investments: Sugarcane Farmers are not cultivating fruit and vegetables because of their perishable nature. According to NITIAayog, about 30% of cane area could be diverted to other crops by providing incentives to farmers at a cost of about ₹9,200 crores.

So, governments could implement a series of post-harvest investments like drying and refrigeration facilities so that farmers can save their perishables till they go to market. This would be a big incentive for more sustainable agriculture.

Shift to traditional diets: While the US consumes the most sugar per capita, FAO estimates China and India will drive the world’s future sugar rush. With the growing desire for a more Western diet,  India has to rediscover more traditional and healthier, diverse diets.

Increase Taxes on sweetened beverages: In Mexico, which had an even more worrying situation than India, showed encouraging results by taxing beverages. With the poorest classes proportionately benefitting, India can also implement similar policies.

Research from scholars highlights that there is a crucial intersection between food security, energy and water in India. Initially, the sugarcane juice can be diverted to produce biofuels to utilise excess sugar. But the long term solution would be making sugar cultivation sustainable, efficient and also making people move away from consuming excessive sugar. Thus, the trajectory of sugar can be turned towards suiting both Earth and humanity.