Sugar stocks: ISMA slams speculators for 'creating panic'

Slamming "few" speculators and sugar refineries for spreading rumours about shortage of sugar in the current 2016-17 season, industry association ISMA today said there is no need to import the sweetener with enough stocks position and surplus production expected next year.
"Some people, with vested interests, are trying to confuse the market by simply throwing various numbers for sugar production and consumption for the country in 2016-17 season," Indian Sugar Mills Association (ISMA) President T Sarita Reddy said in a statement.
Their estimates, mostly made without any analysis and research, is causing speculation and volatility in the sugar market and spiking sugar prices unnecessarily, she said.

"A few speculators and sugar refiners continue to spread rumours to suit their personal vested interests and create opportunities for themselves to import sugar," Reddy said.
Their ulterior motive is to create panic to either artificially push up global prices because they are holding a position in the futures market or want to somehow import sugar into India, she added.
Unlike the sugar millers, the ISMA President said: "The speculators and refiners have no responsibility towards our farmers, domestic sugar manufacturers or even the domestic consumers, and therefore have a short-term gain in mind."

For the 2016-17 season, ISMA has revised sugar production estimates downward to 21.3 million tonnes from its earlier projection of 23.4 million tonnes. It has also lowered the sugar consumption estimates to 24.2 million tonnes for this year taking into account reports of sluggish sugar sales.

"Considering these estimates along with the opening sugar stocks of 7.75 million tonnes, there is no shortage of sugar and therefore, there is no need to import any," Reddy said.
However, with surplus sugarcane and sugar expected next year once again, and the need to pay remunerative prices to farmers, "there is no need to import sugar unnecessarily. This decision should be taken with proper care and certainty."
As per current estimates made by millers across the country, there is no such need as of now, she added.
Reddy said ISMA is totally against any speculation and does not want to unnecessarily put any burden on the nation, especially when there is enough within the country.

"However, drought in major sugar producing areas makes estimations difficult. Therefore, as a responsible association ISMA will be the first to approach government, if and when there is need felt on supplementing domestic availability through imports, with the exact quantity needed and the right approach to do so," she said.
The country's sugar production is estimated to fall for the second straight year in 2016-17 season due to drought in key producing states. Last year, sugar output stood at 25.1 million tonnes.