Sugar firms hope export will save day

Domestic sugar traders hope that prices will stabilise from the current slump with the revival of exports and the country expecting good sugar production. They hope the government will lift the ban on exports by October.

"With this year's estimated production reaching 230 lakh tonne and consumption around 190 lakh tonne, where would the excessive sugar be consumed?" asked Chandra Shekhar Nopany, president of Indian Sugar Mills Association (ISMA) and CMD, The Oudh Sugar Mills Limited.

India has an export obligation of 20 lakh tonne of sugar, out of which 9 lakh tonne have already been exported. "We want the exports to be around 25 to 30 lakh tonne. Even if 20 lakh tonne is exported, the prices would stabilise. However, the downward pressure will remain there," Nopany added.

Sources said once the festive season is over, there are chances that the ban will be lifted by the first week of October. It may strengthen sugar by Rs 50 a quintal, they opined.

According to them, the government seems to be acknowledging the fact of a bumper sugar production. The sugar prices in the retail market have come down to Rs 21.50 a kg and in the wholesale market, they are are hovering around Rs 1,750 a quintal.

Nopany said the prices had to decline, as the production has increased in the country.

However, in the regions like Uttar Pradesh and Bihar, there has been scanty rainfall in the last 20 days, which is a worrying factor. "This is the crucial period of growth for sugarcane in the region and it needs optimum rainfall," Nopany added.

Meanwhile, Maharashtra is expecting a bumper crop this year.

According to an estimate, the state is expected to record a production of 69 lakh tonne.