With global sugar prices falling, the Indian sugar mills have sought an increase in import duty to 60% from the current 40%.

 

According to T. Sarita Reddy, president of Indian Sugar Mills’ Association, the Central government permitted five lakh tonnes of raw sugar imports under zero import duty out of which 4.77 lakh tonnes have arrived.

 

Raw sugar imports have become viable at 40% duty as the international prices are declining. Hence, apart from the quantity permitted by the Government, trade information is that another 3.64 lakh tonnes of raw sugar has been loaded in Brazil and will reach India early next month.

 

The entire quantity would be available in the country from next month. So, there is no requirement to extend the last date permitted for duty-free sugar imports or permit any further quantity under duty-free imports, she said. Additional imports can bring down the sugar prices in the domestic market.

 

Sugar output

 

Sugar production for the current sugar season is estimated to be 203 lakh tonnes. With an opening stock of 77 lakh tonnes from the previous season, the total sugar available is estimated to be 280 lakh tonnes and the domestic requirement is between 240 and 242 lakh tonnes.

 

Closing stock for the current season is expected to be nearly 40 lakh tonnes. With the imported five lakh tonnes available, the closing stock could be 45 lakh tonnes.

 

Sugar prices in the domestic market are down by Rs. 100 to Rs. 120 a quintal in the last one month due to decline in global prices and imports. As against the all India average cost of production of Rs. 3,750 a quintal this year, the average ex-mill price realised by the mills in the last eight months is about Rs. 3,620 a quintal.