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Four Sugar Mills Surrender 23 K Tonnes Import Quota

Date 18-May-2017
Subject Four Sugar Mills Surrender 23 K Tonnes Import Quota

As many as four sugar mills have surrendered their import quota to the tune of about 23,000 tonnes. 

They have cited their inability to undertake it, even as the government abolished customs duty to bring in 5 lakh tonnes into the country.

While one sugar mill in undivided Andhra Pradesh has informed the food ministry not to undertake the sugar import, three mills in Maharashtra have also decided against buying raw sugar and processing it, sources said.

Faced with this refusal, the food ministry has re-allocated the quota among other mills, which were earlier part of the larger 5 lakh tonnes import quantity, sources said.

As the last date for mills to return their sugar import quota ended on May 16, the government hopes that no more surrender will happen.

“Since there is a penalty clause, there may not be further surrender by mills,” an industry official said, adding, “However, there may be default by mills in meeting the deadline to import since the quota has not been made transferable, unlike earlier practice.”

In April, the government had allowed import of 5 lakh tonnes of raw sugar at zero duty, as against the current level of 40 per cent, to meet a domestic shortfall. 

The quota was divided among mills, which have facilities to undertake processing from raw variety to refined sugar.

Southern ports were allowed to import 3 lakh tonnes of raw sugar, western ports 1.5 lakh tonnes and eastern por ts 50,000 tonnes. The quota allocation was based on the location of mills to undertake the refining process. 

Though, initially, the mills were asked to complete the import by June 12, the date was later extended until June 30 at the request of the mills.

The entire process of import is being implemented through the Directorate General of Foreign Trade (DGFT). 

Food minister Ram Vilas Paswan has already said that the government does not have any plan to increase the zero-duty import quantity from the current level of 5 lakh tonnes, considering the quantity of sugar available in the country.

Paswan this month had told Financial Chronicle: “This year we will produce about 20.3 million tonnes sugar.” 

The country had produced 25.1 million tonnes in the 2015-16 (October-September) season. 

However, the minister said that there is adequate stock to deal with the shortage due to carry forward stocks from previous season. 

He also said that the consumption would be 24 million tonnes to 24.5 million tonnes, which is in fact lower than last year’s 25 million tonnes The government last month extended the stock holding limit on sugar traders by another six months until October 28, 2017 to check prices within the current Rs 42-44 per kg.

The stock limit of 500 tonnes & turnover limit of 30 days for sugar traders in the country, other than those in West Bengal, was first imposed in April 2016 & has been extended since then. 

The limit in West Bengal is 1,000 tonnes.


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