The correct statement(s) among the given options are:

1 and 2.

Explanation:

1. Statement 1: Molasses is indeed a by-product of the sugar production process. It is a thick, dark syrup-like substance that remains after sugar has been extracted from sugarcane or sugar beets. Molasses is commonly used as a sweetener and also finds applications in the production of various food products and alcoholic beverages.

2. Statement 2: Bagasse, which is the fibrous residue left after extracting juice from sugarcane in sugar mills, is commonly used as a fuel in the boilers to generate steam. The steam produced is then utilized to power various processes within the sugar factories, including the generation of electricity and the operation of machinery.

3. Statement 3: This statement is incorrect. While sugarcane is the most common raw material used for sugar production, it is not the only source. Sugar can also be produced from sugar beets, which are processed to extract sugar similarly to sugarcane.

Therefore, the correct answer is 1 and 2.