Sugar : Imports will be cheaper in the South India
September 19, 2017 at 7:46 AM ,
Rainbow Exports
Sugar imports will be cheaper in the South
The point of concern is that this time in the south is also dry. In view of this, the government has approved the import of 300,000 tonnes raw sugar at 25 per cent import duty. The general import duty on Sugar imports is 50 percent. About three months ago, the government had sanctioned import of 500,000 tonnes of sugar without any import duty. The South India Sugar Mills Association (SISMA) said, "Tamil Nadu has a huge scarcity, but the conditional import of raw sugar could be made better." At the Intercontinental exchange, the prices of Sugar futures fell by nearly 30 percent since February this year and are currently at 14.13 cents per pound.
However, during the same period, the Ex-mill prices of sugar in Vashi have fallen by nearly 5% to US$607 per mt., which was US$651 per mt. in February 2017. In Kolhapur, between January and August this year, the price of M grade sugar remained in the range of US$580 to 618 per mt.
A source in the industry said, "The government estimates that the supply of sugar in Tamil Nadu will be low in the season's main festival season, so the government has approved the import of 300,000 tonnes of raw sugar." According to business sources, sugar production in Tamil Nadu is estimated to be 1.1 million tonnes in the sugar season 2016-17, while the state's demand is around 1.5 million tonnes. The industry estimates that production is expected to be 600,000 tonnes in 2017-18, due to which there will be a huge shortage of sugar in the state next year.
The Indian Sugar Mills Association (ISMA) said that imported sugar is cheaper from US47 to US$64 per mt. of sugar produced at domestic level. Madan Sabnavis, Chief Economist, Care Ratings said, "The purpose of approving the import of raw sugar is to increase the availability of sugar so that in the festive season, there is a sudden increase in the supply and the prices can be avoided."
Due to the reboot of the refinery boiler, the government has given three months to sugar mills to make a refined sugar from raw sugar to avoid increase in production costs. By that time the new crushing season will start, due to which the imported raw sugar will start refining of the sugar produced at the domestic level immediately. ISMA has estimated that the production of the upcoming Sugar season (October 2017 to September 2018) will be 251 million tonnes.
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