Markets yet to see improvement in sugar prices

Source: The Hitavada      Date: 09 Feb 2018 10:25:25


 

Business Bureau,

The recent decision of the Union Government to hike Import Duty on sugar from 50 per cent to 100 per cent appears to have been showing no significant impact in the markets as sugar prices are still trading at a very low levels.
The decision, that was aimed at supporting the falling prices of the commodity and there by helping sugarcane cultivators and sugar mill operators, could push sugar prices by less than Rs 70 per quital for the past three days since the decision was announced.


It is important to note that sugar prices have been experiencing pressure in the markets for the past few days with the commodity attracting price of Rs 3,000 to Rs 3100 per quital.
With 5 per cent Goods and Services Tax applicable on the commodity and including transportation cost, sugar was being sold in the local markets at a price of about Rs 3,300 to Rs 3,350 till recent past. After the Import Duty hike, price have gone up to a level of Rs 3,420 per quital.


However, after the Government on Tuesday doubled Import Duty on sugar to 100 per cent farmers and traders were expecting price consolidation.
“We have not yet seen any palpable hike in the prices. The market has gone up by mere Rs 60-70 per quital which is not enough as a large number of farmers bearing the brunt of falling prices. The current scenario has also become a cause of worry for the sugar mill operators,” said Pratap Motwani, President of the Wholesale Grain and Seeds Merchant Association.


Motwani said that the decision to double Import Duty of sugar would certainly restrict arrival of the commodity from other countries. “But the fact is that the domestic production of sugar is also very good in the current season and thus the huge stock of sugar has been poruing in the markets,” he said adding that the new season for sugar arrival has began recently.


As per the available data, the country’s sugar production been estimated to 26.1 million tonnes in 2017-18 as against 20.3 MT in 2016-17. However Motwani felt that upcoming festival of Holi followed by summer season would certainly generate additional demand for sugar because of which the prices may go up.