Govt assures sugar industry of examining demand related to export, MSP, ethanol rate | The Financial Express

Govt assures sugar industry of examining demand related to export, MSP, ethanol rate

In May, the government had imposed restrictions on export of sugar beyond 10 million tonnes, but later allowed another 1.2 million tonnes of shipments, taking the total to 11.2 million tonnes for 2021-22 marketing year

Govt assures sugar industry of examining demand related to export, MSP, ethanol rate
India's sugar exports stood at 7 million tonnes in 2020-21 marketing year, 5.9 million tonnes in 2019-20 and 3.8 million tonnes in 2018-19. (Reuters file photo)

Food Secretary Sudhanshu Pandey on Wednesday assured the sugar industry that the government will look into their demand related to export quota, minimum selling price and ethanol rates for the next marketing year.

While addressing a conference, Indian Sugar Mills Association (ISMA) President Aditya Jhunjhunwala demanded that export quota for 2022-23 marketing year (October-September) should be announced at the earliest as the country would have 8 million tonnes surplus sweetener.

That apart, he demanded that minimum selling price (MSP) — the rate below which mills cannot sell sugar — should be increased to Rs 35-36 per kg from Rs 31 per kg and also sought an increase in the ethanol price.

Also Read: Govt to soon announce sugar export quota for 2022-23 market year: Food Secretary 

Pandey said the sugar sector “is now smiling” as it has performed very well in the last few years in production, exports and ethanol supply with the help of the favourable government policy.

However, he said the smile should now be passed on to the consumers.

Responding to the industry’s demand, Pandey said: “From government side, there are many areas which we are still trying to address. Some of the challenges that are being posed, we are aware of these challenges. All the 5-6 points you made, the government is working on all those points and we will be addressing each one of them after interacting with you.” On the sidelines of the event, Pandey said the government will “very soon” announce export quota of sugar for the next marketing year starting October.

In May, the government had imposed restrictions on export of sugar beyond 10 million tonnes, but later allowed another 1.2 million tonnes of shipments, taking the total to 11.2 million tonnes for 2021-22 marketing year.

India’s sugar exports stood at 7 million tonnes in 2020-21 marketing year, 5.9 million tonnes in 2019-20 and 3.8 million tonnes in 2018-19.

Also Read: India set to allow 5 mln tonnes of sugar exports in first tranche

Jhunjhunwala said the sugar production after diversion of sugar for 2022-23 is estimated at 35.5 million tonnes while the domestic demand is 27.5 million tonnes.

“We can export 8 million tonnes of sugar in 2022-23 marketing year. We have urged the government to announce export quota and overall policy at the earliest,” the ISMA President said.

The export window is till March only, after which Brazil sugar will come into the global market, Jhunjhunwala said.

Indian Sugar Mills Association (ISMA) president had written a letter to food and consumer affairs minister Piyush Goyal in this regard.

As per preliminary estimate, ISMA said the net sugar production, without considering the diversion of sugar for production of ethanol, is expected to increase to about 40 million tonnes in 2022-23 from 39.4 million tonnes in the current marketing year.

However, 4.5 million tonnes of sugar are expected to get diverted for ethanol in 2022-23 marketing year as against 3.5 million tonnes in the current marketing year. ISMA said the exports of surplus sugar would help in maintaining domestic sugar prices, which in turn boost liquidity position of mills enabling them to pay sugarcane farmers on time.

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