Falling global sugar prices put export hopefuls in a fix
While players in the sugar sector are urging to be allowed to export the commodity, it is unlikely there will be many takers.
By Gouri Agtey Athale, TNN |
PUNE: While players in the sugar sector are urging to be allowed to export the commodity, it is unlikely there will be many takers. International prices have come down drastically, making exports unviable.
International prices, which were at $470-$480 per metric tonne four months ago, when the ban was imposed, are hovering around today at $340 per tonne, which translates into approximately Rs 1,450 per quintal. Domestic prices, ex-factory, are traded at Rs 1,545-1,590 per quintal. In some southern states, the commodity is available at Rs 1,515 per quintal.
“Farmers have already missed the export bus and even if exports are opened up now, it is unlikely that anyone will export if it is not profitable,” Vickramsinh Ghatge, chairman, Maharashtra Rajya Sahakari Sakhar Sangh, the state’s apex body for the co-operative sugar sector, said.
Mr Ghatge said the central government first opens up exports for those who imported raw sugar two years ago under the advance licence scheme. Close to 10 lakh tonne sugar is still to be exported by them, which could be done first. “Once that is done, a chance could be given to others to export,” he says, adding “they will do so only if it is profitable”.
However, Kanhaiyalal Gidwani, president of the co-ordination committee for consumer protection, industry and commerce, Maharashtra Pradesh Congress Committee (MPCC), said the government waits till the ‘06-07 crushing season is over before taking any decision.
ADVERTISEMENT
Mr Ghatge was categorical that no one would export if it is not sufficiently profitable. The damage was done when exports were banned just when international prices were higher than domestic and farmers could have benefited from export, he said. Asking the central government to withhold permission for export till March would serve no purpose because if international prices then continued to be lower than domestic Indian, no one would export, Mr Ghatge added.
Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
Bookmark or read stories offline -
Download ET Markets APP
Download ET Markets APP
ADVERTISEMENT
