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Expectations Of Fall In Sugar Prices; Mills To Start Next Month

The industry is full of apprehensions this year, while the Center is yet to announce its export policy

Photo Credit : Bloomberg

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Higher production of sugar in Uttar Pradesh can adversely affect its exports. Huge quantity of sugar will be available in the market in the coming sugarcane crushing season.

Against the estimated sugar production of over 100 MT in the upcoming crushing season 2022-23, the state's own consumption is likely to be 40 MT. If the state fails, a large part of the sugar will be deposited in the mills.

Experts say that due to the accumulation of sugar in the mills in large quantities, its price is expected to come down. The price of edible oil had also come down in the last days. The price of palm oil has come down to Rs 77 a litre. Due to which edible oil may become cheaper in the coming days. However, the companies argue that due to the increase in other expenses, it is not possible to reduce the price of oil right now.

The sugar mills are expected to start operations next month. Sugar production cost is mainly governed by the State Advisory Price (SAP), which is highest in Uttar Pradesh. The Yogi Adityanath government had increased the SAP from Rs 315 to Rs 340 per quintal in September last year, ahead of the assembly elections.

Official sources said that due to this, the cost of sugar production has increased from about Rs 31 to Rs 35 per kg. The sugar industry has now demanded diversion of sugarcane for the manufacture of ethanol. A senior functionary of the Indian Sugar Mills Association (ISMA) said the situation was relatively appropriate last year when exports took place.

The industry is full of apprehensions this year, while the Center is yet to announce its export policy. The UP Sugar Mills Association (UPSMA) has already submitted its representations to Cane Minister Lakshmi Narayan Choudhary and Cane Commissioner Sanjay Bhusreddy, seeking their intervention. Industry sources said that due to the timely announcement of the sugar export policy, 10 million tonnes of sugar was exported from India. An official of the sugarcane development department said, "We are waiting for this. This is a decision that the Center should take soon."


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sugar prices sugar mills