Prices of sugar fell in the wholesale markets of Delhi and Muzaffarnagar as the government has raised the cap for sale by mills in February to 2.1 mln ton, slightly higher than 1.85 mln ton in January. In Delhi, prices were down by 15 rupees, while it fell by 25 rupees in Muzaffarnagar. Government wants liquidity to increase so that mills are able to pay dues to cane farmers on time. Other than this, there is no logic in increasing the sale quota. Prices also fell as sellers in the market are higher than buyers. India’s sugar surplus this year is pegged at a record high of 12.8 mln ton, even after accounting for estimated exports of 3 mln ton and a drop of 300,000 ton in output due to diversion of sugarcane to ethanol. prices were steady in Mumbai and Kolhapur. There is no reason for market to go up right now quota has not reflected anything in prices.
Sugar mills in Maharashtra have accelerated their payment and for the fortnight ending on January, they have cleared dues of Rs 3,297.48 crore to the farmers. Maharashtra’s cane arrears that had crossed the Rs 5,300 crore mark by-mid January have come come down to Rs 4,841.15 crore by the end of the month. Along with Uttar Pradesh, sugar mills in Maharashtra have defaulted in payment of the mandated Fair and Remunerative Price (FRP) since the start of the season. Figures from the Maharashtra Sugar Commissionerate show that mills, were to pay farmers Rs 10,487.43 crore as the mandated FRP calculated at the average rate of Rs 2,450 per quintal. Farmers had received Rs 5,166.98 crore with mills reporting arrears of Rs 5,320.35 crore.