India’s sugar industry has sought to allay concerns over the recent rise in retail sugar prices, saying there is no shortage of the commodity in the country and prices are likely to ease in the coming days. The Indian Sugar Mills Association (ISMA), the apex industry body, attributed the recent price increase to multiple factors, including speculative purchases by traders and bulk consumers, along with lower sugar production due to adverse weather conditions. Addressing a press conference on Monday, ISMA President Niraj Shirgaokar said the industry was not responsible for creating an artificial shortage or pushing up ex-mill sugar prices. He maintained that adequate stocks are available in the country to meet demand.
Shirgaokar said India’s sugar availability remains sufficient and rejected concerns about a supply shortage. “India does not have a sugar shortage,” he told reporters in New Delhi. According to the ISMA president, the country’s closing sugar stock at the end of September is expected to stand at around 35 lakh tonnes. This stock, along with fresh production from the new crushing season, is expected to support domestic supplies.
He also said sugar mills are likely to begin operations around October 15 and could produce approximately 10 to 12 lakh tonnes during October. Against this, the country’s sugar demand for the month is estimated at around 24 to 25 lakh tonnes.
Duty-free imports begin to ease price pressure
The industry body said the government’s decision to permit duty-free imports of 1 million tonnes of raw sugar has already started having an impact on the market. Shirgaokar said sugar prices have begun to soften after the import decision, indicating that additional supplies could help ease pressure on domestic prices.
The move comes as the government has stepped up measures against hoarding amid the recent increase in sugar prices. The industry expects the availability of imported sugar, combined with the start of domestic mill operations, to improve supply conditions further.
When will imported sugar reach India?
While imports have been allowed, the timing of shipments remains a key factor for the domestic market. National Federation of Cooperative Sugar Factories (NFCSF) President Prakash Naiknavare said some imported consignments could reach Indian ports before October 15, although it is difficult to determine the exact quantity that will arrive by then.
Brazil is currently the most realistic source for India’s sugar imports, according to Naiknavare. Thailand, another traditional supplier, is facing its own supply shortfall and is therefore unlikely to be a significant source at present.
Brazil-to-India shipments could take 40-45 days
Naiknavare explained that transporting sugar from Brazil to Indian ports generally takes around 40 to 45 days. Once the cargo reaches India, additional time is required for it to move from the port to the concerned sugar mills. “So, it is difficult to put a number on how much can arrive before October 15th, but the possibility of some shipments arriving by then is good,” Naiknavare said.
He also pointed out that several steps are involved before imported sugar reaches the domestic market. These include approvals and allocation by the Directorate General of Foreign Trade (DGFT), issuance of letters of credit and scheduling of shipments. The final quantity and timing could also be affected by congestion at Brazilian ports, making it difficult to provide a firm estimate of arrivals before October 15.
October 31 import deadline may get some flexibility
Naiknavare further said the government is unlikely to enforce the October 31 deadline for sugar arrivals too strictly. According to him, consignments that are already in transit beyond the deadline could still be permitted to enter the country. This could provide some additional flexibility to importers dealing with the long transit time between Brazil and India.
Why sugar prices rose despite adequate stocks
The recent increase in sugar prices has been linked to a combination of factors rather than an outright shortage, according to the industry. Lower production caused by adverse weather conditions has tightened the supply situation, while speculative buying by traders and bulk consumers has added to market pressure. The government’s anti-hoarding measures and decision to permit duty-free imports are now aimed at improving availability and preventing further price escalation.
The arrival of imported sugar, the resumption of crushing operations around October 15 and fresh domestic production could therefore become important factors in determining the direction of sugar prices in the coming weeks.
(With inputs from PTI)
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