India's sugar industry body shares a positive price outlook
Retail sugar prices are expected to decrease soon as speculative stocking eases. The industry body attributes recent price hikes to speculation and weather-related production issues. Domestic sugar stocks are currently estimated below the government's normative buffer level. The government has permitted duty-free raw sugar imports to address supply concerns.
The Indian Sugar Mills Association (ISMA) anticipates a decline in sugar retail prices as speculation behind the price hike diminishes. The surge in sugar prices, from ₹48.18/kg on July 20 to ₹63.12/kg as of August 23, was primarily fuelled by speculative stocking and lower production due to weather-related issues. ISMA President Niraj Shirgaokar stated that the recent price rally was not backed by fundamentals, with speculation and hoarding playing a significant role in the increase.
He affirmed that there is no sugar shortage in the country and that sugar mills are not accountable for creating artificial scarcity or driving up ex-mill prices. The government's decision to permit duty-free imports of 1 million tonnes of raw sugar has started to ease sugar prices. By the end of September, sugar stocks are projected to reach around 35 lakh tonnes.
Sugar mills are expected to resume operations on October 15 and produce 10-12 lakh tonnes during the month, which falls short of the estimated October demand of 24-25 lakh tonnes. Bulk buyers typically begin stocking sugar one-to-two months in advance, contributing to price hikes. The industry body asserts that the present stock position is adequate and that the retail price rise is not due to any shortage or lack of sugar availability.
Written by urgent.news from The Economic Times - Economy's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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- 'No sugar shortage': ISMA says India has enough stocks, prices to cool down soon timesofindia.indiatimes.com
