Indian mills have produced 2.79 million metric tons of sugar since the current season began on Oct. 1, down 35.4% year on year, as mills in two key states started operations later than usual, a leading industry body said on Monday.

Lower sugar production could lead the world's second-largest producer to refrain from allocating export quotas and support global prices .

The start of sugar cane crushing in the western state of Maharashtra and neighbouring Karnataka was delayed, but soon crushing will pick up momentum, said Prakash Naiknavare, managing director of the National Federation of Cooperative Sugar Factories Ltd (NFCSF).

Maharashtra's production in the first two months of the new season fell 66% from a year ago to 460,000 tons, while Karnataka's output dropped 36% to 700,000 tons, the industry body said.

Mills in the northern state of Uttar Pradesh have produced 1.29 million tons, down 1 % from a year ago.

By the end of November, 381 sugar mills in the country had started crushing operations, compared to 433 during the same period a year ago, Naiknavare said.

India could produce 28 million tons of sugar in 2024/25, down from 31.9 million tons produced a year ago, estimates NFCSF.

(Reporting by Rajendra Jadhav, Editing by Louise Heavens)