Sugar prices in U'khand touch all-time high

Prices of sugar in Uttarakhand have reached an all-time high of Rs 42-44 per kg in the retail market, thanks largely to sugarcane shortfall.

Prices of sugar at the wholesale markets in Uttarakhand stood at Rs 3,800-3,900 per quintal, market sources said.

The prices of the commodity, which were Rs 20-22 by the beginning of 2009, have almost doubled within one year, a new record in the country. At some places in the retail market, sugar is even being sold at Rs 45.

In the face of the sugarcane shortfall, sugar mills in Uttarakhand and western Uttar Pradesh are currently running at about 70 per cent capacity with expectations rising high among farmers that prices of cane procurement would also jump further.

The sugar mills are now mulling to pay more to the farmers. This is despite the fact that the mills last month had increased the procurement price by Rs 5 to Rs 10 in order to attract farmers.

Earlier, sugar mills were paying Rs 220-225 to farmers, now they are giving Rs 230-235. Officials of sugar mills told Business Standard that the retail prices may firm up further to stabilise between Rs 45-50.

“We have entered into a new scenario where both farmers and sugar mills are happy. While farmers are reaping dividends of the best prices so far, mills are also set to make profits,” said a government official.

After touching as low as Rs 3,300 per quintal last month, prices of sugar never stabilised and began bouncing back quick and fast. This upward trend would continue for some more time till the prices settle at Rs 4,000 per quintal, market sources said.

Initially at the start of the crushing season, the sugar mills faced no problem as farmers lined up to sell their produce. But of late, the farmers are not showing much interest as they are currently busy in winter sowing.