Second time reallocation of sugar export quota
India has reallocated its 2024-25 sugar export quota to ensure efficient distribution. Initially set at 10 lakh tonnes, some mills returned their quotas while others sought more. The government adjusted domestic sales accordingly. Mills can either transfer quotas to others, especially near ports, or return them for reallocation, optimizing export operations across sugar-producing states.
iGrain India – The reallocation of the sugar export quota for the second time during the 2024-25 marketing season in India is a significant move by the government to ensure an efficient and flexible distribution of sugar exports across various mills. Here’s a breakdown of the key points:
Quota Allocation and Exchange: The government had initially allocated a total export quota of 10 lakh tonnes of sugar. However, some mills returned their allotted quota, while others expressed a desire for more. As a result, the government has streamlined the process and redistributed the quotas based on the availability of the sugar mills’ willingness to export or adjust.
Adjustments in Monthly Domestic Sales: As part of this process, the monthly free sale quota for sugar in the domestic market has been adjusted. This change is based on the quantities of export quota being exchanged between mills. If a mill exchanges or returns part of its export quota, the domestic sales quantity will be adjusted accordingly.
Two Methods for Quota Exchange:
- Transfer Between Mills: Mills that do not wish to export can sell their export quota to those that are willing to take on the export responsibility. This is common in states like Maharashtra, Karnataka, Gujarat, and Andhra Pradesh, where mills are closer to ports, making it more feasible for them to handle export operations. Mills in northern states like Uttar Pradesh and Bihar, where transportation costs to ports are high, typically opt to sell their quotas.
- Return to Government: If mills decide not to export their allotted sugar, they can return the quota to the government, which will then reallocate it to other mills that are more willing or able to manage the exports.
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Source : Investing.com
