Amid sugar exports topping the cap of 100 lakh tonnes (lt) as of August 1 in the current sugar season (October-September), the Government on Friday formally announced that an additional 12 lt will be allowed for shipments above the limit fixed earlier. This will help mills improve their liquidity by ₹3,600 crore and clear cane price arrear of farmers, Food Ministry said.

The overall sugar position was reviewed by the government in last week of July and it has been decided to allow export of sugar up to 112 lt in the interest of sugarcane farmers and sugar industry, the ministry said in a statement.

“Even after export of sugar up to 112 lt, closing stock of 60 lt will be maintained and as crushing in Maharashtra, Karnataka and other States will commence between the first and third week of October, there would be sufficient availability of sugar in the country at reasonable price. Retail price would likely remain stable,” the ministry said.

The Government in May imposed restrictions on export of sugar beyond 100 lt fearing scarcity which could have spiked local prices during festival period of September-November. The government was also concerned about food inflation and keeping a close watch on the macro scenario going across the globe.

However, there have been changes in the stock position of sugar since the time of imposition of restrictions, like an increase in sugar production and a decrease in sugar consumption due to weak demand in the domestic market, the ministry has said. Crushing of sugarcane generally commences from the end of October or the first week of November. However, in the ensuing 2022-23 sugar season due to sufficient availability of sugarcane, crushing of cane is likely to commence early from first week of October.

Export of sugar of 100 lt in the current sugar season has helped in improving the liquidity of sugar mills by ₹33,000 crore enabling them to clear cane price dues of farmers. Cane price due of farmers was at ₹9,700 crore as of August 4.

A committee of ministers headed by Home Minister Amit Shah had cleared the additional sugar for export amid demand from the sugar industry to approve 10 lt. This time, there will be quota for each mill which have declared to the government their stock position of raw sugar, either at mill or at port, estimated at 7-8 lt, sources said. Besides, the refined and white sugar already despatched from mills for export are also to be given permits, the sources said. The approval of additional quantity also includes some sugar for neighbouring countries on diplomatic grounds, the sources said.

Meanwhile, farmer leader VM Singh on Friday demanded the Centre to withdraw the hike and review the increased amount, which is too low amid rising inflation. He said his organisation will soon appeal to the Uttar Pradesh government to fix the State Advised Price of sugarcane at ₹450/quintal, considering the high cost of diesel and increased cost of cultivation in the State.

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