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Government not to raise sugar export quota till Diwali

20 Jun 2011 Evaluate

The government has put a break to speculation of more sugar export from the country and has stated that it will not allow more sugar exports till Diwali as it does not want retail prices of the sweetener to rise during the festive season.

Food and Consumer Affairs Minister K V Thomas has said that 'We will take a view on export after meeting the festival demand and looking at domestic price situation.' The demand of sugar generally increases during the festive season during October-November. Thomas also pointed out that the retail prices of sugar are still fluctuating and in some places, rates are as high as Rs 40 per kg.

It was speculated that government might allow for more export of the sweetener after the Industry representatives met Thomas earlier last week to demand for additional exports of 1.5 million tonnes of sugar. In April, the government had allowed export of five lakh tonnes of sugar under Open General Licence, out of which 51,500 tonnes has been kept aside for the neighbouring countries.

The minister further stated that 'The decision on exports will depend on price situation in the retail market and estimates of next year's production.'  He, however, said that the government would consider the industry's demand to lift the stock-holding limit on sugar to boost domestic sales.

Meanwhile, according to the Agriculture Outlook prepared jointly by Paris-based OECD and UN body FAO, sugar production in India, the world's second biggest producer and largest consumer, is expected to be on an average 32 million tonnes (MT) per year for the next 10 years. India requires 22.5 million tonnes of sweetener annually for its domestic consumption.

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