AISTA urges govt to extend sugar sale of February quota by two weeks

Trade body AISTA on Tuesday urged the government to extend the deadline of selling sugar of February quota by two weeks in March as millers were not able to sell their monthly allocated quota in the domestic market.

At present, the government fixes a monthly quota for the sale of sugar in the domestic market. On average, about 21 lakh tonne quota is fixed for a monthly sale for mills.

For the current month, the nodal food ministry has fixed 22 lakh tonnes for the sale of sugar for mills. Mills are required to sell at least 90 per cent of the monthly quota as per the stock holding limit order of the ministry.

Speaking to PTI, All India Sugar Trade Association (AISTA) Chairman Praful Vithalani said the association has written a letter to Union Food Secretary Sanjeev Chopra sharing constraints faced by mills in selling the February quota of sugar.

He said most sugar mills have not been able to complete their sales quota during the current month and "we have requested the Secretary to grant an extension of two weeks for the sale of the February quota in March."

In the letter, Vithalani said sugar mills in Maharashtra and Karnataka are bleeding due to the rule of complying with the minimum 90 per cent sale of the monthly quota.

Currently, many mills, that do not have the capacity to hold sugar for 12 months, are selling more than their allocated monthly quota. As a result, wholesale sugar prices have dropped to as low as Rs 3,325-3,370 per quintal in Maharashtra, which is grossly below the cost of production, he said.

He also said the slide in prices of sugar needs to be arrested.

Vithalani also mentions that in Maharashtra, evacuation of most of the sugar is for non-producing states by railway rakes. Railways have not been able to provide an adequate number of rakes for the despatch of sugar. Consequently, sugar intended for West Bengal, Assam and north east is held up.

In its first estimate, AISTA has pegged the country's sugar production at 31.6 million tonnes in the 2023-24 season (October-September), marking a decline of 4 per cent against the previous season.

The government is keeping a close watch on sugar and other commodities ahead of general elections.