New MSP at RS 29/kg for sugar mills still not enough for cane arrears

The current year is expected to end with a closing stock of 10 mt, even if mills export a million tonnes. The estimate for a year later is a possible sugar surplus of 17-18 mt

Sugar prices at the wholesale markets here crossed Rs 29 a kg after Wednesday's decision by the Union government to fix this as the legal minimum sale price (MSP) for mills. 

Sugar-S closed at Rs 30.17 a kg, while Sugar-M at Rs 31.25 (ex-mill) in Navi Mumbai, up 13 per cent from their November 19 low, after which, reports of incentive packages to be announced pushed prices up.

The Centre issued four notifications on Thursday. The new MSP is to also apply to importers. It also notified mill-wise stock limits for June, similar to the earlier release mechanism, totalling 2.1