Sugar stocks comfortable, no abnormal price rise: Centre

Ending speculation on lowering import duty on sugar to boost supplies, the government on Wednesday clarified that the country has adequate domestic stocks to meet any extra festival demand and that prices haven't shown any abnormal rise in the past few months.

"All India average retail price of sugar is hovering at Rs 40-42 a kg. For the past six months, sugar price has been almost stable and the government has been constantly monitoring the rates," the Ministry of Consumer Affairs, Food & Public Distribution stated.

The statement comes against the backdrop of a high-level meeting on Tuesday to review the prices of essential commodities, which also included sugar and pulses.
 

Sugar prices had risen by Rs 50 paise a kg in some cities of the country owing to supply shortage, triggering speculation that the Centre might lower the 40 per cent import duty to smoothen supplies, particularly during the festival season.

A Bloomberg analysis also showed that despite not lowering the duty, India might import less sugar than predicted three months ago after global prices surged to a four-year high and the first normal monsoon in three years boosted the outlook for domestic crop. The report said that imports might total 1.25 million tonnes (mt) in the year starting October 1, the most since 2009-10 compared with 2.1 mt predicted in June.

According to industry sources, India's sugar production in 2016-17 crop year is expected to be 23.37 mt, down from 25.1 mt last year. Industry players also feel that despite low production in 2016-17, there won't be any shortage of sugar in the country as stocks in hand are adequate.

"With carry-over stock of 7.5 mt from sugar season in 2015-16 and expected sugar production of 23.4 mt in 2016-17, there will be enough sugar available in 2016-17 to meet the domestic demand of 25.6 mt (considering a demand growth 2.5 per cent) in the next season," the Indian Sugar Mills Association had said recently.

There would be carry-forward stocks of 5.2 mt for sugar season 2017-18, it added.

Meanwhile, Food Minister Ramvilas Paswan said the government was keeping a close watch on the prices of sugar, pulses and edible oil to check hoarding and ensure adequate availability in the market in the festival season.

According to government data, the average retail price of sugar was ruling at Rs 40 a kg on Wednesday, against Rs 30 a kg in the year-ago period.

In case of pulses, there has been some fall in retail prices in the past few weeks on improved supply from new crop and imports, but the rates are still higher than last year with gram been sold at Rs 110 a kg, tur at Rs 120 a kg, urad at Rs 135 a kg, moong at Rs 82 a kg and masoor dal at Rs 85 a kg.

Among edible oils, the retail price of groundnut oil and mustard oil was ruling stable at Rs 135 a kg and Rs 100 a kg, respectively, while soya oil and sunflower oil showed a marginal decline to Rs 85 a kg each.