Ripples Advisory, Enforce sugar exports, raise the selling price
The move will help cut losses in the domestic market
As the cash-strapped sugar industry scrambles to deal with low sugar prices and oversupply, it has urged the Centre to increase export targets steeply and enforce it, according to a reliable source.
At a meeting with the Government earlier this week it had sought an “enforceable mandate” to ensure a total of 80 lakh tonnes (lt) of sugar are exported in the current season and the next, according to industry representatives.
The Indian Sugar Mills Association has supported this move provided the minimum selling price of sugar is increased from the present ₹29 a kg, which is well below the cost of production of about ₹34. This will give the mills financial strength to absorb export losses. Also, the Government can do away with export subsidy and the complicated monthly release of sugar, the Association has said.
It is inevitable that sugar is siphoned out from the domestic market. In these two years sugar production will total about 640-650 lt against a domestic consumption of about 520 lt, said industry representatives. In addition to the 20 lt of export planned in the current season, over 60 lakh tonnes will have to be moved out in 2018-19 (October-September). If 12-15 per cent of production is exported, the industry can absorb the export loss and benefit from better prices in the domestic market.
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