The government imposed limits on sugar stocks until November to reduce prices | Today’s news
New Delhi: The Center has imposed stock limits for sugar traders across the country from August 1 to November 30 to curb hoarding, discourage speculative trading and ensure adequate supply of sugar at reasonable prices during the festival season.
The move follows an increase in ex-mill sugar prices that is “not supported by the prevailing underlying demand and supply,” the food ministry said in a statement.
“It was also found that hoarding by certain traders, dealers and market intermediaries along with speculative transactions and paper trading without actual physical movement of sugar from the mills contributed to creating an artificial perception of shortage in the market,” the report said.
These practices led to avoidable price instability and increased ex-factory and retail sugar prices.
For organized inventory
The government said the restrictions were aimed at ensuring proper domestic supplies, protecting consumer interests and allowing genuine business and distribution activities to continue without interruption. It also assured consumers that the country has sufficient sugar reserves to meet domestic demand and said it would continue to closely monitor the market and take additional measures if needed to ensure availability of sugar at reasonable prices.
Based on the order, all sugar traders have been asked to declare their sugar stock and update it weekly on the online portal of the Ministry of Food and Public Distribution.
Earlier, on July 17, the Indian Sugar and Bioenergy Manufacturers Association (ISMA) and the National Federation of Cooperative Sugar Mills Ltd. (NFCSF) assured all stakeholders that availability of sugar in India remains comfortable and the country has sufficient sugar reserves to comfortably meet domestic consumption requirements.
Focus welcome
Domestic consumption of sugar varies between 28.1-28.5 million tons depending on the sector.
Currently, institutional consumption such as food and beverage companies, hotels, restaurants and catering (HoReCa) sector and processed food accounts for 60-65% of total demand, with the remaining share coming from retail households.
“We welcome the government’s continued focus on ensuring a stable and well-regulated sugar supply chain across the country,” said Deepak Bellani, CEO of industry body Indian Sugar Mills Association.
“The industry has always supported measures that promote transparency and fair distribution, and requiring sellers to declare stock positions on the ministry’s online portal is a welcome step towards greater accountability and real-time visibility of supply in the market,” Bellani said.
Earlier on May 13, the government banned sugar exports until September 30, which would help improve domestic availability and curb prices.
