lucknow: The price of sugar may fall in Uttar Pradesh in coming days not just because of the impact of Union Budget, but due to sugar mills having recorded a carry forward stock of 5 million tonnes for the year 2018-19, which is almost equivalent to the annual sugar consumption for eight months, as per UP Sugar Mills Association figures.The carry forward stock nationally is around 14.5 million tonnes, hence sugar prices are likely to dip across the country.
“The buffer stock is already very high which has resulted in dip in prices of sugar. The prices are expected to plunge further in coming days,” a senior UPSMA office-bearer told TOI on Sunday.
Moreover, sugar recovery for ongoing crushing season has recorded a jump from 10.85% in 2018-19 to 11.48% in 2019-20, further increasing the stock. UPSMA said high buffer stock forced the millers to sell sugar at a price lower than production cost, hitting the paying capacity of millers in the state.
According to UP cane development department, sugar mills have paid only Rs 7,498 crores against total payment of Rs 13,394 crores in the ongoing crushing season, which is 56% of total cane dues.
The mills are defaulting on payment of over Rs 5,896 crore. The corporate sector is the biggest defaulter, accounting for more than Rs 5,300 crores in dues. The cooperative sector mills have payment dues of Rs 461 crores, while state-owned corporation mills still have to pay Rs 109 crores to cane farmers.
A senior official of cane department said all the sugar mills have been instructed to clear their cane dues on time and keep the operations going on.
The state government has allowed use of B-grade heavy molasses for production of ethanol to tackle the probability of sugar prices falling down, he added.
Source : TOI