New Delhi: In a relief to the sugar industry, the government on Monday decided not to take away the unsold sugar in the open market from millers for ration shop distribution.
The sugar sector is controlled by the government right from the production through the distribution stage.
The food ministry decides the quantity of sugar that can be sold in the open market during a particular period with a condition that the unsold stock would be taken away for meeting ration shop demand. As a result, mills are under pressure to sell their allotted quota.
“It has also been decided that there would be no automatic conversion of any unsold quantity into levy sugar (meant for ration shops)” an official statement said.
The relaxation of this condition would benefit millers as they will be free to sell sugar in the open market as per their cash flow requirements, market conditions and individual commercial considerations.
Besides this, the food ministry has also reduced the quantity of sugar to be sold in the open market during the December-March period to 66.50 lakh tonnes from 68 lakh tonnes. Earlier, mills were asked to sell 70 lakh tonnes sugar including the carryover stock of 2 lakh tonnes from October and November period of 2012.
“The fresh non-levy quota released for four month period from December to March, 2013, shall stand reduced to 66.50 lakh tonnes instead of 68 lakh tonnes,” the statement said.
This excludes the quantity carried over from October to November of last year and sold up to December, 2012, it added.
Overall, 106.5 lakh tonnes of sugar has been allocated for open market sale in the first six months of the 2012-13 sugar season that started from October 2012.
According to industry data, mills have produced 49.05 lakh tonnes of sugar till 15 December of the current seasons, about 2% higher than the year-ago period.
Total sugar output is estimated to be 240 lakh tonnes, as against 260 lakh tonnes in the last year.