look news india
The Central Government has taken a big and tough step to control the rise in sugar prices in the domestic market before the upcoming festive season. The Ministry of Consumer Affairs, Food and Public Distribution has issued an order to impose a stock limit of 400 metric tonnes on wholesalers and stockists across the country with immediate effect. Along with this, the government has completely rejected those reports and rumors which were claiming that sugar has become expensive in the country due to the diversion of sugarcane juice for 20% ethanol blend (E20) in petrol.
Strict stock limit of 400 tonnes to prevent hoarding
According to the order issued by the Food Ministry, this limit has been set to crack down on speculators and hoarders who make unfair profits by creating artificial shortage during festive demand:
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Wholesalers and Dealers: No wholesaler will be able to keep a stock of more than 400 metric tonnes of sugar at any time.
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Retailers and Chain Outlets: Limited stock capping has been implemented separately for each outlet of retailers and large retail chains.
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Mandatory Portal Registration: It has been made mandatory for all dealers and mills to register their weekly stock position on the official portal of the Department of Food and Public Distribution.
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Deadline: This restriction will remain effective in the entire country till the end of the festive season i.e. 30th November.
Government calls claims of ethanol diversion as baseless
There was a strong discussion in the market that under the biofuel policy of the Centre, the physical supply of sugar has reduced due to sending of sugarcane juice and B-heavy molasses for ethanol production.
On this, the Food Ministry clarified that at present 70 to 75 percent of ethanol production is being met from grains (maize and surplus rice). Only that surplus capacity from sugar mills which does not impact domestic food security has been permitted for ethanol. The ministry said the main reason behind the rise in sugar prices is the uncertainty of weather in some producing areas and speculation by some traders, and not the ethanol policy.
Rules set for wholesale consumers and mills also
The government has imposed restrictions not only on traders but also on industrial consumers who use sugar on a large scale:
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15 day stock rule: Large companies manufacturing confectionaries, cold drinks, bakeries, confectionaries and biscuits will not be allowed to hold advance stock more than their maximum requirement of 15 days.
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Physical verification of warehouses: Joint teams of state governments and central agencies have been directed to conduct physical verification in mills and warehouses so that immediate punitive action can be taken if mills withhold supplies despite release of quota.
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New crushing season from October: Sugar mills have been instructed to start the new crushing season from October 15, due to which more than 10 lakh tonnes of new sugar will be available in the market in the month of October itself.
Consumers hope to get relief
The Food Ministry has reiterated that there are sufficient sugar reserves in the country for domestic consumption and there is no need for any kind of panic buying. The government has a complete mechanism to balance the supply through the monthly release quota system. With the implementation of stock limit of 400 tonnes and increased strictness in the mandis, there is every possibility of stability in retail prices during the festive season and relief to the general public.