India to replace monthly sugar quota with fortnightly system
India will replace its monthly sugar quota system with fortnightly allocations from September, requiring mills to sell 40% of their quota in the first week and the balance in the next. Mandatory dispatch within seven days aims to accelerate supply, curb stock accumulation and stabilize prices.
India will introduce a fortnightly sugar allocation system from September, replacing the existing monthly quota system, to ensure faster movement of sugar and timely availability in the domestic market, the government said in a press release issued through the Press Information Bureau.
Under the new system, sugar mills will be required to sell at least 40% of their allocated quantity in the first week and the remaining quantity in the succeeding week, the government said. The system will enable closer monitoring of demand and supply and allow it to release additional quota whenever required, it said.
The government has also directed sugar mills to dispatch sugar within seven days of sale. It said the combination of fortnightly allocation and mandatory dispatch will help sugar move faster from mills to dealers and consumers and discourage unnecessary accumulation and speculative holding of stocks.
The measures follow a recent rise in sugar prices. However, ex-mill sugar prices have declined by around 20% in recent days, while retail prices have also started moving lower, the government said.
A nationwide physical verification of sugar stocks at mills found adequate availability, with some mills holding stocks higher than those declared in their monthly returns. The exercise also found instances of mills selling less sugar than their allocated quota, which the government said unnecessarily constrained market supplies.
The government expects additional supplies in the coming months. Operational mills in Karnataka and Maharashtra are expected to add around 2 lakh metric tonnes of sugar during September, while more than 10 lakh metric tonnes is expected to be produced in October and around 45 lakh metric tonnes in November.
Sugarcane crushing for the new season will begin from October 15. The government has allowed mills to sell sugar produced during October without restriction to ensure that new-season output reaches the domestic market at the earliest.
The government said there is no shortage of sugar in the country and assured consumers of adequate and continuous availability at reasonable prices, particularly during the forthcoming festive season.
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Source : ChiniMandi
