ISMA seeks govt permission to export sugar

ISMA, the apex sugar industry body, today demanded the government immediately allow export of at least 5 lakh tonnes of sweetener to ensure that mills are able to pay sugarcane farmers. 

On the government's recent decision to abolish import duty till March 2011, Indian Sugar Mills Association (ISMA) said that it would have no impact as global prices are higher by Rs 5-6 per kg than the domestic rates.

"The government should at least allow export of 5 lakh tonnes of sugar to ensure that industry is able to pay cane price of Rs 210/quintal," ISMA Director General Abinash Verma said.

He was replying to a query on the food ministry's decision to refer the issue of allowing export of 5 lakh tonnes under OGL to empowered group of ministers (EGOM) on food for review.

Verma noted that India would have a surplus production of 2.5 million tonnes in 2010-11 (October-September), out of which the government has allowed export of 1.2 million tonnes under Advance License Scheme (ALS).

"There is still surplus of 1.3 million tonnes of sugar which needs to be taken care of. Otherwise, mills would not be able to pay cane price to farmers as surplus sugar would bring down the domestic prices," he said.    

Verma said inflation in sugar is also negative, so there should not be any problem in allowing exports. Sugar prices have come down to Rs 32-33 per kg from nearly Rs 50 per kg in January last year.

ISMA has pegged sugar production in 2010-11 sugar year at 25.5 million tonnes against the annual domestic demand of 23 million tonnes. The country had produced 18.8 million tonnes in the previous sugar year.

On imports, Verma said, "there will be no imports till March even at zero import duty as this is a peak production in India. Moreover, global prices are higher by Rs 5-6 per kg than domestic prices".