UP keeps state advised price for sugar unchanged; cos applaud the move

The state advised price (SAP) for sugar have remained unchanged for Uttar Pradesh (UP). Appreciating the move, Vivek Saraogi, MD of Balrampur Chini said that this is a practical decision.

“This year, the yields are a little lower, the crushing is lower, and even the recoveries are a little lower than last year. So all of this leads to a cost pressure. So having acknowledged that and seeing the reality on the ground, any other additional cost pressure based on raw material price would have been unfair and unwarranted. So, it is a very pleasant decision and a step in the right direction with a lot of thinking behind it,” he said in an interview to CNBC-TV18.

On prices, he said “The production to my view would be south of 300 lakh tonne. So, I think there is going to be a lot of production. The government of India has also come out with a circular which is issued to all state governments saying that they must strictly enforce the minimum support price (MSP) and the quota. It has been sent out especially to UP, Maharashtra, and Karnataka being the 3 largest states producing almost about 85% of the country’s sugar. I also see a lot more traction in the global markets and therefore exports should increase. There is some logistics issue and there is some lethargy amongst millers, but the net impact of this I personally feel that prices will start improving very soon.”

He said that he expects India to be able to achieve 90% of exports. “Decision usually comes in October-November when you are given a year which is a sugar year up to end September. This year the time period allowed for 6 million is up to end December. So, I would feel that the entire 6 million would get exported, give or take half a million. 90% should get done,” he said.