India raises sugar quota ahead of festivals

India raises sugar quota ahead of festivals

Mumbai: India has allowed millers to sell 200,000 tonnes of additional sugar, over and above the earlier fixed quota for free sale in August, keeping in mind Hindu festivals later this month, a government official told Reuters on 11 August. Also, the government has allowed mills to sell 300,000 tonnes more in September.

“The additional quota is unlikely to ease prices since the demand is far more than the supplies," an analyst at a brokerage in Mumbai said.

The demand for the sweetener rises during Hindu festivals, which begin later this month.

The federal government, which controls the sector, had allowed mills to sell 900,000 tonnes of sugar in the open market this month, lower-than the market expectations of 1.2-1.3 million tonnes.

Additionally, it allowed mills to sell 25% of the 3 million tonnes of buffer stock created last year, to help millers with excess supplies.