-30 %: sugar prices slide down vortex

NEW DELHI: New year has failed to bring any cheer for the sugar industry. Sugar prices are still on a downslide despite government’s measures to save the financially crunched sector . Sugar prices have fallen by 30% in just a year and has touch the lowest in 5 years.
The current sugar price in Kolhapur mandi, Maharashtra is Rs 23-24 per kg of sugar and in UP is around Rs 27-28 per kg.“Government has announced interest subvention scheme for the ailing sugar sector but that has helped (only ) to pay off some amount of cane arrears. The industry is desperately seeking liquidity and hence is selling off sugar in bulk at whatever price possible,” said MG Joshi, managing director, National Federation for Co-operative Sugar Factories (NFCSF).
In the wake of mounting cane arrears , government recently announced a bailout package for the sugar industry. As per the recommendations of the PM-appointed informal group of ministers, a 12% interest subsidy on Rs 6,600 crore loan was given, for paying off cane arrears.
Industry experts say that until there is some export movement, sugar prices would not see any correction. “Sugar mills are waiting for some clearance on the raw sugar export assistance by the government,” said Joshi.
Agriculture minister-led group of ministers approved incentives for the export of 4 million tonne of raw sugar. There, however, is friction between the industry and government on the amount of subsidy. While the government has suggested an incentive of Rs 2,400 per tonne of raw sugar produced for export, industry is seeking a financial support of Rs 3,500 per tonne. Cabinet is yet to take a final decision on the matter.