Sugar exports from Maharashtra is expected to get a boost after the central government asked for quarterly export plans for mills across the country. Mills have been asked to submit their quarterly export plans for the sugar season (October-September) 2019-20 by December 24.

Back in September, the central government had announced a special scheme for export of 60 lakh tonnes (lt) of sugar for the current season. Mill-wise quota was announced and the scheme was to see the central government dole out over Rs 6,200 crore worth of subsidy for the mills. The subsidy was to be transferred directly to the accounts of the farmers. Exports, it was hoped, will reduce the sugar inventory and help mills increase their realisation and thus pay farmers on time.

Till date, around 15 lakh tonnes of export contracts have been signed, of which more than 10 lakh tonnes have been cornered by Uttar Pradesh mills. Mills in Maharashtra have been sluggish in exports mainly because of lack of ready cash with them. Also due to a shortfall in sugar production, mills are expecting a rise in domestic sugar price, which has acted as a deterrent for them.

Industry insiders, however, said exports have become lucrative as mills are allowed to claim 50 per cent of the subsidy upfront and not wait till their entire quota is exported. “This will solve the liquidity problem facing many mills,” said a senior official of the sugar commissioner.

Another major impediment for exports is that banks are not ready to release sugar stock till the mills pay up the difference between the present valuation of sugar and the international prices. In this regard, the Maharashtra State Cooperative Sugar Factories Federation has written to the Maharashtra State Cooperative Bank to allow for a scheme which will see the banks extending loans at low interest to help mills export sugar.

In its letter, the central government has asked mills to submit details of export contracts executed as well as physical dispatch made. Mills who wish to surrender their export quota are also asked to indicate the same. A quarter wise export plan has also been asked from the mills.