Central authorities cracks whip, asks sugar mills to stick to MSP

Alarmed over sugar mills deliberately promoting sugar beneath the federal government specified Minimum Selling Price (MSP) of Rs 3,100/- per quintal, the central authorities has warned of stringent motion in opposition to errant mills. In a letter to cane commissioner of the most important sugar producing states, Jitendra Juyal, joint director, ministry of shopper affairs, meals and public distribution has requested for names of such mills to be intimated to the central authorities for additional motion.
Four months into the sugar season of 2020-21, sugar mills in Maharashtra and Karnataka had began promoting sugar beneath the MSP. This was principally to generate fast funds to clear their dues in manner of fee of the Fair and Remunerative Price (FRP) for cane procured from farmers in addition to different operating price. This phenomenon of worth chopping was rampant in Solapur the place virtually all of the mills have been indulged in the identical, Marathwada and Ahmednagar the place half of the mills have been doing so.
Back in 2018, the central authorities had mounted the MSP of sugar at Rs 3,100/- to stop millers from promoting the identical at prices far beneath the price of manufacturing. This transfer was wanted to stabilize the market in a yr when extra sugar manufacturing had seen millers promoting the sweetener at costs as little as Rs 2,500-2,600.Along with the MSP, the mils got mounted month-to-month quota on the market to maintain sugar from flooding the markets.
In his letter to the sugar mills the joint director pointed how how each the measures have been launched to stop money loss to sugar mills and keep the demand provide stability in home market.
“The limit of sales/dispatch of all sugar mills are determined based on a very well defined and uniform criteria based on stock held by the sugar mills along with incentive given on diversion of sugar to ethanol and on account of export. Objective of imposing the stock holding limit on sugar mills is to ensure that a level playing field is provided to all sugar mills. Further, stock limit on sugar mills are being imposed in such a manner that release of sugar from the mills are restricted to the extent of consumption requirement of the country so that the sugar price remains stable at a reasonable level.,” the letter learn.
Blow MSP gross sales, he identified, would dislodge your complete steps take by the Government for the survival of sugar trade and will lead to accumulation of cane worth arrears of farmers. Millers, who defy the identical, the officer stated, will face motion below the Essential Commodities Act, 1955. Cane commissioners have been requested to challenge mandatory directions to the sphere officers within the state to minitor the sale of sugar by mills within the home markets and to make sure that the sugar mills don’t breach the MSP.
Welcoming the transfer, Bhairavnath B Thombare, president of West Indian Sugar Mills Association (WISMA) stated below promoting posed an ideal risk to the trade. “For quick gains many of the mills had tied with traders- this would have killed the industry,” he stated.