ISMA urges govt to lift sugar export curbs as sugar stock rise

The Indian Sugar Mills Association (ISMA) has asked the government to consider allowing sugar producers to export an additional up to 2 million tonnes of the sweetener, citing surplus stock in the country.

According to the industry, which follows the October-September cycle, the country’s sugar stock opened at 5.6 million tonnes in October 2023, while production for the 12-month period is forecast at 32 million tonnes by the end of September 2024. Considering the country is expected to consume 28.5 million tonnes during the period, this would still leave a surplus of 9.1 million tonnes.

“Considering that the government maintains a safety net of around 5.5 million tonne, we will still have a surplus of approximately 3.6 million tonnes,” CNBC-TV18 quoted Deepak Ballani, Director General of ISMA as saying.

Even after accounting for the country’s ethanol blending needs, the industry will have 1.5 to 2 million tonnes available for exports, the ISMA DG said.

Another media report quoted Ballani as saying that allowing exports would not only ensure a comfortable stock for domestic consumption and sustain the Ethanol Blending Program (EBP) but also contribute to maintaining the financial liquidity of sugar mills, enabling timely payments to farmers.

The industry has pressed the government to also consider raising the minimum support price (MSP) for sugar, which was last raised in 2018. Since then, the government has raised the fair and remunerative price (FRP) for sugarcane, which has made input costs pricier for sugar mills.

For the current sugar, the government approved an 8% increase in sugarcane FRP paid to farmers to ₹340 per quintal in February.

ISMA has been hoping that the MSP for sugar will be raised to ₹3,900 per quintal from the current ₹3,100 per quintal while another sugar body, the National Federation of Cooperative Sugar Factories (NFCSF), has sought an MSP of ₹4,200 per quintal.

Sugar prices in the country are quoting at a price higher than the MSP. While ex-sugar price is quoting at ₹36 per kg while retail prices are at the ₹42-44 per kg.