NEW DELHI: The government on Monday partially lifted the “restriction” on export of sugar after almost 31 months by permitting mills to ship 10 lakh tonnes for the 2024-25 season ending Sept, a move that will support the industry. However, nearly two dozen sugar mills have been barred from exporting their stockas they had violated rules by selling excess sugar in the domestic market than their allotted monthly quantity.
The food ministry has put out detailed guidelines for mill-wise allocation of 10 lakh tonnes export quota. The decision came barely days after the government reduced the reserve price of rice stored with the Food Corporation of India (FCI) from Rs 2,800 a quintal to Rs 2,250 for sale to state governments, their corporations, and ethanol distilleries.
Announcing the decision of allowing sugar export, food and consumer affairs minister Pralhad Joshi on X said, “This ensures price stability, supports five crore farmer families, five lakh workers, and strengthens the sugar sector.” The sugar industry had urged the government to allow export of 20 lakh tonnes of the sweetener, citing that there is enough surplus to meet all domestic demand and for maintaining the required stock for the next year.
Officials said the exports will help mills for timely payment of cane dues, besides balancing availability and prices for consumers. Welcoming the decision, Deepak Balani, director general of Indian Sugar & Bio-Energy Manufacturers Association (ISMA), said, “The permission to export reflects the government’s commitment to balance domestic availability with industry’s financial health. It will contribute to timely cane payments to farmers.”
The decision comes as local sugar prices hit an 18-month low, pressuring margins of mills, and the country’s sugar output is projected to decline to 270 lakh tonnes in 2024-25 from 320 lakh tonnes tonnes in the previous year by a millers organisation, which is less than the domestic consumption requirement of over 290 lakh tonnes. However, industry insiders said this was a brave and commendable move.
As per the guidelines, new mills starting production in 2024-25 and those restarting operations after closure have also received export quotas. Mills can export either directly or through merchant exporters till Sept 30. They have the option to surrender quotas by March 31 or exchange them with domestic quotas to reduce transportation costs. The policy also allows mills to swap export quotas with domestic monthly release quantities through mutual agreements and for that they need to take food ministry’s approval.
