Business News | Sugar Prices Likely to Cool off as Panic Buying Eases, Says ISMA
Get latest articles and stories on Business at LatestLY. Sugar prices are likely to cool off as panic and speculative buying ease, with sufficient stocks available in the country, Indian Sugar & Bio-energy Manufacturers Association (ISMA) Director General Deepak Ballani said on Monday.
New Delhi [India], August 24 (ANI): Sugar prices are likely to cool off as panic and speculative buying ease, with sufficient stocks available in the country, Indian Sugar & Bio-energy Manufacturers Association (ISMA) Director General Deepak Ballani said on Monday.
"We are hoping that the prices will go down because we have seen today that there is a trend that the ex-mill prices have started going down. So we are hoping that the effect of this will also come on the retail prices and the prices will rationalise," Ballani told ANI on the sidelines of the ISMA Press Conference.
Ballani said the rise in sugar prices over the past 20 days was driven by speculative and panic buying rather than a shortage of physical sugar.
"This price rise in the last 20 days is because of the speculative buying, the panic buying; there are absolutely no problems of the physical sugar availability in the country," he said.
"There was a perception given that there could be some tightness, which led to panic buying, speculative buying...which I believe was unfounded," Ballani said.
He said the industry expects to close the season with almost 35 lakh tonnes of sugar and that the government has also assured the country of sufficient stocks.
ISMA President Niraj Shirgaokar said the association has sought a reduction in the sugar holding limit for traders from 400 tonnes to 200 tonnes so that more stocks are released into the retail market.
"We have asked them to reduce the limit from 400 tonnes to 200 tonnes so that the most sugar is released into the market and into the retail and then the consumer sees the actual correction in the price during the festival season," Shirgaokar told ANI.
He said the government has taken several measures over the past four to six months, including physical verification of stocks at sugar mills and limits on traders, institutional buyers and bulk consumers.
Shirgaokar said the government has announced imports of 10 lakh tonnes of sugar as a precautionary measure to ensure comfortable availability.
"Ten lakhs is the projected import, so we are quite positive that there will be a lot of bidders given that the raw sugar is viable today to import," he said.
During the event, Shirgaokar said India has 35 lakh tonnes of closing stock, which is a comfortable level going into November, while the projected 2025-26 net sugar production is around 279 lakh tonnes.
Shirgaokar said retail sugar prices rose from around Rs 48 per kg in July to Rs 55-56 per kg in August, an increase of nearly 16 per cent, largely due to speculative and panic buying.
On ethanol, Ballani rejected suggestions that diversion of sugar towards ethanol was responsible for the recent price increase.
"Ethanol is absolutely not to be blamed for any cost increase," he said, adding that domestic consumption remains the first priority.
On the next sugar crop, Ballani said it was too early to assess the impact of El Nino and a deficient monsoon, adding that a clearer picture could emerge in around 20 days.
Shirgaokar also said the impact of El Nino on yields and different regions would become clearer only after a couple of months.
"Again, very early to say, but we are hopeful that there is a good crop and there is a sufficient amount of sugar which can be diverted to ethanol," he said.
Madhav B Shriram, Vice President, ISMA, said that sugar consumers may not face any sugar problem this festive season.
To curb the rising retail prices and secure local supply for the upcoming festive season, the Indian government has approved the duty-free import of 10 lakh metric tonnes (1 million tonnes) of raw sugar, marking the country's first sugar imports in nearly a decade.
Alongside this, strict measures have been implemented to prevent speculative hoarding, including a 400-tonne stock limit for dealers, a 15-day inventory cap for bulk industrial consumers, and a mandatory 7-day timeline to lift purchased stock from mills. (ANI)
(The above story is verified and authored by ANI staff, ANI is South Asia's leading multimedia news agency with over 100 bureaus in India, South Asia and across the globe. ANI brings the latest news on Politics and Current Affairs in India & around the World, Sports, Health, Fitness, Entertainment, & News. The views appearing in the above post do not reflect the opinions of LatestLY)