Free-sale sugar quota hiked to check prices

Industry says cane SMP hike behind price rise

The government has released a free-sale sugar quota of 1.2 million tonne (instead of one million tonne) for March to check the rise in sugar prices even as the sugar industry sought to justify rising prices by pointing to the hike in the statutory minimum price (SMP) for sugarcane.

With the earlier release of 1,82,000 tonne of levy sugar for March, the total availability of sugar (free-sale and levy) in the domestic market in March will be 1,38,000 million tonne.

The increase in the quota follows reports of a rise in sugar prices in different parts of the country.

The food and consumer affairs ministry, which controls sugar releases for the market, has also announced that it will release additional quantities of sugar if the price rise continued unabated.

The National Federation of Cooperative Sugar Factories, on the other hand, has described the reports about sugar price rise as "exaggerated".

"These reports have created uncalled for apprehensions among the public," National Federation of Cooperative Sugar Factories Managing Director Vinay Kumar said in a statement issued today.

He pointed out that sugar prices were on the decline till recently and had started picking up slightly this month.

"Considering a 30.12 per cent increase in the SMP, from Rs 56.10 per quintal in 1999-2000 to Rs 73 in 2003-04, an equivalent increase in the wholesale price of sugar is justified," he stated.

Sugar coating

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• Free-sale sugar quota increased to 1.2 million tonnes from 1 million tonnes for March
• The total availability of sugar (free-sale and levy) in the domestic market in March will be 138,000 million tonnes
• Sugarcane SMP at Rs 73 per quintal in 2003-04