Sugar Industry Wants to Export; Govt Apprehensive of Price Spurt .

New Delhi, September 28

Just ahead of the festive when the demand for sugar is at its peak, the industry has escalated its demand for allowing export of the commodity, basing its arguments on availability of surplus stocks

This is likely to lead to a spurt in prices, especially with the Maharashtra government all set to pay higher prices to farmers in the key cane producing state, as reported yesterday.

Claiming that exports will not effect retail prices of the essential commodity, the Indian Sugar Mills Association (ISMA) said the government should allow export of at least 4 million tonnes of sugar under the open general licence.

This too, should start from the beginning of the new sugar season, in October. They say that that the season is expected to open with an estimated opening stock of 5.8 MT.

However, Food Ministry headed by KV Thomas does not seem too convinced even though it has agreed to reconcile the discrepancies in the production figures projected by the Agriculture Ministry and his ministry and promised to take steps to maintain price stability both for industry and consumers.

Firm on its earlier projected figure of around 26 MT production in the new season despite the Food Ministry last week pegging the sugar output at a much lower 24.6 MT, ISMA said an estimated increase of 4 per cent in cane area the new season would result in increase sugarcane production.

The discrepancy in figures is a bone of contention between the Agriculture Ministry headed by Sharad Pawar and Thomas. Pawar recently pegged the production around 25.5-26 MT on the basis of good monsoon.

“The estimated sugar cane crush during the next sugar season 2011-12 will be around 264.5 MT, which translates into a sugar production of 26 MT. The total availability of sugar, therefore, works out to 31.8 MT. The domestic consumption would be around 22 MT and therefore sugar mills will be left with 9.8 MT of surplus sugar,” ISMA argued.

Source : tribuneindia.com