--Buys 11,000 tn sugar from Mayuri Sugar Mills in Chittoor

--To buy 11,000 tn sugar/mo via tenders for 10 mos from July By Shrikant Kuwalekar

MUMBAI - In the first tender by a state government after decontrol of the sugar sector, the civil supplies department of Andhra Pradesh last week bought 11,000 tn sugar for sale via public distribution system in June, said a state government official today.

"We have purchased 11,000 tn sugar at 29.75 rupees a kg, ex-factory, the delivery of which will commence soon," the official told Cogencis. Mayuri Sugar Mills in Chittoor in the state was awarded the tender, he said. The civil supplies department will float another tender for monthly supply of 11,000 tn sugar for 10 months starting July, said the official.

"We will issue another continuous global tender for 11,000 tn sugar in a week or two producers, importers or wholesalers are eligible to participate " the official said adding that the department expects the rate of 29.00 rupees a kg in this long-term tender.

On May 2, as partial decontrol of the sugar sector, the Centre notified scrapping of the levy quota mechanism, under which mills were required to sell 10% of the output to the state government at a price at least 30% lower than the market price. States were told to purchase sugar for public distribution system via open market and the Centre would subsidise the difference between purchase and sale price.