In order to protect the interest of sugarcane farmers and ensure dues are paid on time, the government has approved creation of a sugar buffer stock of 4 million tonnes (MT) for a period of one year from August 01, 2019 to July 31, 2020. It is 1 MT higher than buffer stock of 3 MT last year.
The government has decided this in view of bumper domestic production and pending sugarcane arrears of more than Rs 15,000 crore. The government will spend an estimated Rs 1,674 crore for this purpose. The buffer stock will help maintain demand-supply balance and to stabilise sugar prices.
This move will lead to improvement in the liquidity of sugar mills, reduction in sugar inventories, stabilization in sugar prices by alleviating of price sentiments in domestic sugar market and thereby facilitate timely clearance of cane price dues of farmers; and benefits for sugar mills in all sugarcane producing States, by way of clearing sugarcane price arrears of sugar mills.
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