The Centre has extended the deadline for sugar mills and refiners to surrender unused raw sugar import quotas to September 30. This extension provides additional time for these stakeholders to evaluate their import decisions, especially as domestic sugar prices have decreased while global prices have increased.
But the cost of importing sugar has changed since the government announced the imports. Domestic prices have fallen, while global prices have risen. This means imported sugar is now more expensive than sugar available in India. “With the government taking action, it is not easy to predict what level domestic prices would go to.
She estimated that raw sugar imported from Brazil would cost around ₹ 44 a kg after reaching India. After refining and adding GST, the selling cost would at least come to around ₹ 52-53 a kg, making imports unattractive as domestic sugar can be bought for less. Ex-mill prices of sugar have fallen down to ₹ 45 per kg from their highs of over ₹ 65 per kg in mid-August.
“With significant correction in domestic sugar prices and with an increase in global sugar prices, there is no parity to import now,” a sugar analyst, who did not want to be named, said. The country is unlikely to import a lot of sugar, according to the analyst. So it is unlikely that anyone will take the risk,” the analyst said.
The decision comes less than a month after the government allowed duty-free imports of 1 million tonnes of raw sugar under a special quota to increase supplies and keep prices under control ahead of the festive season.
