News International Sugar Journal

India – McKinsey calls for diversification, productivity increases and investment in R&D [Registered]

The consultant failed short of suggesting a radical reform of the production arm of the politically sensitive sugar policy which has contributed to the “worst-crisis in 30 years” that the industry is facing. Nonetheless McKinsey acknowledged that “The current regulatory structure protects [which] farmer interests in the form of fair and remunerable price (FRP) for sugarcane has led to Indian millers operating at uneconomical EBITDA (earnings before interest, tax, depreciation and amortisation) margins for the last three to five years. Many sugar mills are distressed with low profitability and ROE (return on equity) and have defaulted on loans, with significant…

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