Govt softens stance on sale of non-levy sugar

The Government has partially relaxed norms for mills to sell non-levy sugar quota for March in the open market. It has given them seven more days to sell the allocated quantity, the Ministry of Consumer Affairs, Food and Public Distribution said in an order dated March 10. The validity period for each week in March is extended by seven days so that mills can sell quota for week ending March 31 by April 7, the Ministry said. The Government had earlier asked sugar mills to sell a part of their monthly non-levy quota every week, failing which the unsold quantity will be converted into levy sugar and sold at subsidised rate through the public distribution system (PDS).

Separately, the Indian Sugar Mills Association (ISMA) said that India is expected to produce 16.8 million tonnes of sugar in the current season that ends in September, raising its output forecast by 5%. Yields in the top sugar producing states, Maharashtra and Uttar Pradesh, have improved, president Vivek Saraogi said. Several sugar mills have started winding up operations as they have crushed all available cane and many others are likely to shut down by end-March, he added.

Improved supply and higher output figures for 2010-11 have pressured retail prices of sugar over the last month to Rs35-40 per kg range, down from a high of around Rs50 a kg at the end of December and early this year. Sugar was selling at Rs31.75 per kg. This was slightly higher over March 8 when it was selling at Rs30 per kg. This is because the Maharashtra State Cooperative Sugar Factories Federation issued an appeal to sugar mills, asking them not to sell sugar below Rs32 per kg at ex-mill rates.