Sugar glut crashes prices to 7-yr low

Tribune News Service & PTI

New Delhi/Mumbai, April 17

Record domestic production and a glut in global markets have resulted in ex-factory prices of sugar touching a seven-year low.

The Indian Sugar Mills Association (ISMA) has said the domestic ex-mill sugar prices have fallen by Rs 8-9 per kg since October 2014. Sugar prices had touched Rs 45 per kg in 2014 after supplies fell sharply, but they have fallen to a low of Rs 30 per kg in the retail markets this year.

With cane price arrears remaining pending at Rs 19,300 crore, ISMA said: “The situation is alarming,” India’s sugar production has risen by 15% to 26.35 million tonnes so far during the current marketing year. ISMA said the output would cross 27 million tonnes in the 2014-15 marketing year (October-September) against 24.3 million tonnes in the previous year. The annual domestic demand is pegged at 24.8 million tonnes.

In Maharashtra, the sugar production rose to 9.96 million tonnes till April 15 as against 7.44 million tonnes in the year-ago period. The Bombay Sugar Merchants Association said: “Wholesale sugar prices are around Rs 2,700 per quintal as more supplies are coming into the market.”