Sugar co-ops seek cut in export duty, rap Centre

Sugar output is estimated to drop to 23.5 mt in the next 2016-17 season

Cooperative sugar millers from across the country alleged the central government’s ‘hyper sensitiveness’ on the commodity’s price had led to a clamp on export and this might affect their ability to clear sugarcane dues to farmers.

The National Federation of Cooperative Sugar Factories (NFCSF) demanded reduction in the export duty recently imposed, to help mills earn more and clear the Rs 9,000 crore of cane payment arrears.

Sugar output is estimated to drop to 23.5 million tonnes in the next 2016-17 season (October-September) from 25.2 mt this year, said NFCSF.

“The government is over-sensitive towards prices. The retail price is Rs 40 a kg and cost of production is Rs 33-34 a kg. This gap needs to be addressed,” NFCSF President Dilip Walse Patil said. He criticised the decision to withdraw the cane production-linked subsidy and impose a 20 per cent export duty.

“The current ex-mill sugar rate of Rs 32-33 a kg is not enough to clear cane dues and past loans,” he told reporters. The ex-mill sugar rate has to increase to at least Rs 35 a kg, he said. As for exports, they’d be unviable at the current level of duty.

NFCSF would soon make a representation to the government in this regard, after discussing with its board members on Friday, he added.

On May 19, the government had withdrawn the scheme to provide a production subsidy of Rs 4.50 a quintal of cane crushed by mills. The export duty was announced last week.