New Delhi: With retail sugar prices crossing Rs 40 per kg level, the Centre has directed state governments to impose stock holding limits on sugar traders to check hoarding and control price rise.
The stock holding limits are imposed under the Essential Commodities Act. It means traders cannot hold stocks beyond the limit specified by the state government. “Keeping in view the sugar price trend, we have asked the state governments as a precautionary measure to impose stock holding limits on traders to check hoarding,” Food Minister Ram Vilas Paswan said.
Meanwhile, rating agency ICRA said that drought conditions in Maharashtra may hit the domestic sugar production in the sugar year 2016, which is estimated to decline by 10 per cent at around 25.5 million metric tonnes. Sugar prices were depressed during 2014-15 marketing year on record production and huge carry over stock that led to sharp rise in cane arrears of about Rs 21,000 crore.
However, the prices have been inching up on expectation of lower output and the government’s order to mandatory export of 3.2 million tonnes in the ongoing 2015-16 marketing year (October-September).
Mills have exported only 1.3 million tonnes of sugar so far in this marketing year and are likely to ship 7,00,000 tonnes more by September.