Sugar can become expensive in the coming days as the government may increase the minimum sale price (MSP) of sugar by up to Rs 200 per quintal. Traders say sugar mills, however, are waiting for MSAP to increase. According to information received from market sources, the wholesale price of sugar has increased by Rs 150 per quintal in the last 15 days in Delhi, the capital of the country.
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Currently, the wholesale price of sugar in Delhi is Rs 3400–3500 per quintal, while the retail price is between Rs 3800–4200 per quintal. At the same time, the ex-mill rate of private sugar mills of Uttar Pradesh is Rs. 3200-3300 for M-30 single filter sugar, while the ex-mill rate of sugar of government mills is Rs. 3150-3170.
MSP of sugar at Rs 3100 per quintal
Currently, the MSP of sugar fixed by the government is Rs 3100 per quintal. If the MSP is increased by Rs 200, the MSP of sugar will be Rs 3300 per quintal. Meaning, no mill below this price will sell sugar. Therefore, sugar may become expensive in the coming days. The task force constituted by NITI Aayog has also recommended an increase in MSP by Rs 2 per kg.
… then the increase in MSP is also fixed
Experts say that the MSP of sugar is fixed according to the FRP, the remunerative price of sugarcane. Therefore, if the government approves the increase in the FRP of sugarcane by the CACP, the Agricultural Costs and Prices Commission, then the MSP is also set to increase. Delhi-based Chinese businessman Sushil Kumar said that this is the reason why sugar mills are currently waiting for the increase in MSP and are not interested in withdrawing the quota for the current month.
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He informed that in the current month, a quota of 18.5 lakh tonnes has been fixed for sale to sugar mills. On the other hand, hotels, restaurants and canteens have been allowed to open from next week, which is expected to increase the demand for sugar slightly, which may also cause a slight rise in prices. Recently, according to the production estimate released by the sugar mills organization Indian Sugar Mills Association i.e. ISMA, the production of sugar in the country this year may be 270 lakh tonnes.