Even as Chief Minister Devendra Fadanvis has warned the mills that the government will take away sugar at regulated rates for public distribution system, millers said the domestic market has become more lucrative than overseas options and that some of them have seen a dip in output due to drought.

Wholesale prices in the domestic market are ruling at . 30 per kg, while exporters are offering ` ` . 25 per kg. The Centre has fixed a mandatory sugar export quota for all sugar mills in the country for 2015-16 season, linking it with a subsidy of ` . 45 per tonne for payment of sugarcane. The CM had said last week, “If exports do not take place, we may have to think about taking sugar from mills at regulated price as a mandatory measure for distributing it through PDS.“ Though the sugar industry worked hard to get this deal from the government, with the rise in domestic prices the industry is now divided about who should export first. “The private mills want cooperatives to export first so that they can reap the benefits later. As there is still time to fulfil the quota, mills will now be interested in taking benefit of the domestic market prices,“ said an official.