Cooperative sugar mills seek cut in sugar export duty

Cooperative sugar mills body NFCSF today sought cut in export duty to help mills earn better realisation and clear cane arrears of over Rs 9,000 crore, while criticising the government for being "over sensitive" towards sugar prices.
The country's output is estimated to drop to 23.5 million tonnes in the next 2016-17 season (October-September) from 25.2 million tonnes this year, the National Federation of Cooperative Sugar Factories (NFCSF) said.
"The government is over sensitive towards prices. The retail price is Rs 40/kg while the cost of production is Rs 33-34/kg. This gap needs to be addressed," NFCSF President Dilip Walse Patil said while criticising the government's recent

move to withdraw cane production-linked subsidy and imposition of 20 per cent export duty on sugar.
"The sugar sector is in trouble today. We need more realisation for sugar. The current ex-mill sugar rate of Rs 32-33/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/kg level in order to help cash-starved mills to clear cane arrears of Rs 9,045 crore, he said.

Patil further said, "Mills would have been in a better situation had the government not withdrawn cane production linked subsidy and imposed 20 per cent export duty."

"The exports at current level of duty is unviable. It is necessary to reduce the export duty," he said.
NFCSF would soon make a representation to the government in this regard after discussing with its Board members tomorrow, he added.
On May 19, the government had withdrawn the scheme to provide a production subsidy of Rs 4.50 per quintal of cane crushed by mills and later on June 16 export duty of 20 per cent was slapped on the sweetener with an aim of checking the rise in domestic retail sugar prices.
Patil said the discontinuation of some benefits provided for mills are not allowing domestic sugar rates to reach an appropriate level.

Announcing the sugar production estimates for next 2016-17 season (October-September), NFCSF said sugar output in India is estimated to decline to 23.5 million tonnes in the 2016-17 season from 25.2 million tonnes this year.
However, the total sugar availability would be 30.3 million tonnes in 2016-17 season (October-September) including an opening stock of 4.37 million tonnes, much higher than the estimated annual demand of 26 million tonnes.
The government has also estimated fall in sugar output in 2016-17 at 23-24 million tonnes but total availability would be more than enough to meet the domestic demand.