Agri Business

The government expects no problem with availability in the domestic market

Unlike wheat exports in which each letter of credit (LC) is verified, the government adopted a different yardstick on sugar and distributed a 1 million tonne (mt) export release order quota on a pro-rata basis among those exporters who had applied for the permits. It also allotted additional 0.8 mt of export quota to sugar mills and asked them to ensure the quantity lifted in next 30 days.

The companies (exporters) that have received the approval include Shri Dutt India for 1,77,141 tonnes, Shree Renuka Sugars for 1,37,415 tonnes and Garden Court Distilleries for 1,03,424 tonnes, according to the notification issued on June 5.

A total of 62 exporters (including some mills) had submitted 326 applications (separately for different quantities) on the National Single Window System seeking permits worth 2.3 mt. After perusing these applications, the Food Ministry has approved 1 mt and asked them to export within 90 days. The allottees of export release order (RO) quota will have to submit a progress report to the Directorate of Sugar weekly.

The allocation to an exporter, for instance, has been made out of a 1 mt total quota as per its percentage share in the request quantity of 2.31 mt. While Mills need to dispatch sugar within 30 days of issuance of RO, exporters need to comply with shipments within 90 days, the Ministry has said.

Out of 335 applications received from mills for export permit worth 1.75 mt, the government distributed the quota of 0.8 mt, a food ministry notification said Monday,

No availability concerns

The government on May 24 announced that sugar (raw, refined and white sugar) exports from June 1 would be allowed only through permits and fixed a maximum quantity of 10 mt for this season (October-September). The order issued by the Directorate General of Foreign Trade (DGFT) will be valid until October 31. However, sugar being exported to the EU and the US under CXL and tariff rate quota (TRQ) are exempt from the current restriction.

A day after the decision, Food Secretary Sudhanshu Pandey had said that, unlike wheat, where shipments were prohibited, the step in sugar was to monitor the movement of the sweetener out of the country so that there was no problem with domestic availability. In sugar season 2021-22, about 8.2 mt of the sweetener has been dispatched from sugar mills for export, out of which, a record 7.8 mt have been already shipped, out of the contracted 9 mt. The government expects no problem of availability in domestic market as another 2.8 mt can go out of the country.

Published on June 06, 2022