Govt likely to set Aug sales cap for sugar mills at 2.05 mln tn

Thursday, Jul 30, 2020


–Source: August sugar sale quota seen at 2.05 mln tn vs 2.1 mln Jul 

By Preeti Bhagat


NEW DELHI – The Centre may set the cap for sugar that mills can sell in August at 2.05 mln tn, lower than 2.10 mln tn for July as summer demand has waned, a senior government official said today.


"Quota has been set keeping in mind demand for festivals next month such as Raksha Bandhan and Janmashtami… Demand is still poor in Maharashtra but might pick up next week," the official said.


In north India, mills expected an improvement in demand ahead of the festival season. However, demand so far is only 25-30% compared to last year.


The government has been fixing the maximum quantity of sugar available for sale on a monthly basis to support prices and help mills clear cane arrears.


In 2019-20 (Oct-Sep), India's annual domestic sugar sale is seen at 25 mln tn, translating to a little over 2.08 mln tn a month.


India consumed about 24.7 mln tn of sugar in 2018-19, based on the monthly sales quota set by the government. Consumption was much lower than the industry's estimate of 25.5-26.0 mln tn.


For 2019-20, government has pegged annual domestic consumption of sugar at 25 mln tn. 


Production of sugar in 2020-21 is likely to rise to 30.5 mln tn after diversion to ethanol, from 27.2 mln tn this year, mainly due to an increase in output in Maharashtra and Karnataka, ISMA had said last week in its preliminary estimates.  End


Edited by Arshad Hussain


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