The Government has relaxed the sugar stockholding limit for bulk consumers from fifteen to thirty days. The relaxation is subject to the condition that the quantity of stock held beyond the existing fifteen days’ limit shall be sourced exclusively from sugar imported under the Advance Authorisation Scheme and Tariff Rate Quota.
The Consumer Affairs, Food and Public Distribution Ministry said the stockholding limit for purchase from the open market shall remain unchanged and will be restricted to fifteen days’ consumption only. The decision comes after the Government held detailed consultations with major bulk consumers of sugar.
The Ministry said, the measure is intended to strike a balance between the interests of bulk consumers and the need to maintain stability in the domestic sugar market. It added that the move will provide greater operational flexibility to genuine industrial consumers during the upcoming festival season.
The Ministry said, Retail sugar prices have declined by around 10 per cent from their peak however, ex-mill prices have already declined by nearly 25 per cent. The Government observed that the slower decline in retail prices indicates that the benefit of the reduction in ex-mill prices has not yet been fully transmitted through the supply chain to the consumer.
The secretary in Department of Food and Public Distribution has underlined that the reduction in ex-mill prices has not yet been reflected fully in retail prices. The Secretary said this during a joint meeting held today with representatives of ISMA, the National Federation of Cooperative Sugar Factories and sugar trade.
The Government today made a strong appeal to the sugar trade, wholesalers and retailers to immediately pass on the benefit of the significant reduction in ex-mill sugar prices to consumers. The Ministry said that the Government has emphasized that the decline in retail prices must keep pace with the correction already achieved at the mill level. The Government has also called upon the entire sugar value chain to collectively ensure that sugar and sugar-based products remain affordable and within the reach of consumers during the forthcoming festivals.
The Ministry emphasised that the Government has consistently worked to balance the interests of sugarcane farmers with the need to maintain stable and reasonable sugar prices for consumers. With the commencement of the new sugar season from the first of the next month, sugarcane farmers will receive the increased Fair and Remunerative Price (FRP) of 365 rupees per quintal.
The Government has been increasing FRP every year to ensure remunerative returns to sugarcane farmers while maintaining balance in the sugar sector. The Ministry added that the Government will continue to closely monitor the availability and prices of sugar in the domestic market and take appropriate measures, to ensure adequate availability of sugar to consumers as well as the requirements of the food processing and other industries.
