What I have learnt is Cane availability for crushing comes out of acreage.
Acreage gets affected by many factors. This season is badly affected a) scanty rainfall till august b) excess rainfall in Sep (suspected will lead to lower yield and recovery) c) Red Rot disease spreading fast and wide in fields with excess rainfall flow contaminating fresh areas.
Cane crop is not a fresh plant every season. It is resprouted. So if one season turns out bad (rain or disease affected badly), it usually takes 2-3 seasons to come back even with good rainfall. SS2024-25 season is predicted to face a harsher El Nino effect (fir whatever it is worth)
Now add to these new plant coming up near a plant area – Government has to allocate some part of the cane availability to the new mills. As mentioned these are financially strong players – so they can easily lift their quota and actually try and divert more procurement their way (by way of influencing middlemen, which the stronger players always do around the financially weaker mills, I am told).
Anyone interested/invested in Dwarikesh – can do more scuttlebutt on this aspect to corroborate and/or demolish Management claims.
My reading is cane availbility for crushing will be at a Crunch in around factories which have more of these problems than those who face these to a much lesser extent (mentioned in above posts). Good to question in Analyst Calls coming up soon 
How it pans out we will get more clarity by Mid Nov, and established by End Nov.
| Subscribe To Our Free Newsletter |
