An export quota of 6 million tonne has been permitted from November 1 to May 31, 2023
An export quota of 6 million tonne has been permitted from November 1 to May 31, 2023
The government, which has allowed export of 6 million tonne of sugar till May 31 of the ongoing 2022-23 season, on Sunday said it could consider allowing more export after periodic assessment of domestic production.
A Food Ministry notification issued on November 5 said export quota of 6 million tonne has been permitted from November 1 to May 31, 2023, with an option for millers to export on their own or through exporters or swap with domestic sale quota.
In a statement issued on Sunday, the Ministry said the export quota has been fixed based on the available initial estimates of sugarcane production in the country.
“The sugarcane production in the country will be reviewed periodically and based on the latest available estimates, the quantity of sugar exports to be allowed could be reconsidered,” the Ministry said.
Mills have been asked to export allocated sugar quota speedily to make early payment to cane farmers, it said.
Mill-wise sugar export quota has been fixed for the current season (October-September) based on average production of sugar mills in the last three years and average sugar production in the country in the same period, it said.
Further, to expedite sugar exports and to ensure flexibility to sugar mills in execution of the export quota, mills are allowed to surrender the quota partially or fully within 60 days of the date of issue of order or they can swap the export quota with domestic quota within 60 days.
“This system would ensure lesser burden on the logistics system of the country as the swapping system would reduce the need to transport the sugar from distant locations to the ports for exports and movement of sugar across the length and breadth of the country for domestic consumption,” the Ministry said.
Further, swapping would also ensure liquidation of sugar stocks of all mills. Mills, which are not able to export, could swap their export quota with domestic quota of sugar mills which are able to export more, mainly due to their vicinity to ports, it said.
At the end of 2022-23 season, it is expected that most sugar mills will be able to sell their production either in domestic or international market through exports and will clear the cane dues of farmers in time.
“Thus, the policy has created a win-win situation for sugar mills in the country,” the Ministry added.
In the ongoing 2022-23 season, the Ministry said sugar availability for domestic consumption would be 27.5 million tonne, while 5 million tonne of sugar would go for ethanol making and the closing balance would be about 5 million tonne at the end of the season.
The sugar production in 2022-23 season has already commenced in Maharashtra and Karnataka from October onwards, whereas in Uttar Pradesh and rest of the cane-growing States, it would kick off in a week’s time.
In October alone, mills had manufactured 4.05 lakh tonne of sugar which was lower by 14.73% from the year-ago period, according to cooperative body National Federation of Cooperative Sugar Factories Limited.
The government had restricted sugar exports towards the end of the 2021-22 season (October-September) from June 1 to ensure sufficient stocks for domestic consumption and prevent any rise in retail prices during festival period.
About 11 million tonne of sugar was exported during the entire 2021-22 season and earned ₹40,000 crore worth of foreign exchange for the country, the Ministry said.
Timely payment and low carrying cost of stocks for sugar mills also resulted in early clearance of cane arrears of farmers.
As on October 31, more than 96% of cane dues of farmers for 2021-22 season were already cleared despite record procurement of sugarcane of more than ₹1.18 lakh crore, it said.
According to the Ministry, sugar exports are under the “restricted” category till October 2023. By restricting the sugar exports, domestic prices will remain under control and no major inflationary trends will arise in the domestic market.
The Indian sugar market has already seen very nominal price increase which is in tune with the increase in fair and remunerative price of sugarcane for farmers.
In the last six years, the government has taken multiple and timely initiatives in sugar sector enabling sugar mills to stand on their own.
The export of sugar has been permitted without subsidy support this season and it is expected the mills will perform well without financial support.
Sugar production stood at record 35.92 million tonne in 2021-22 season. Maharashtra, Uttar Pradesh and Karnataka are the top three sugar producing States in the country.
