Hike in sugar MSP will increase in the Northern region to Rs 32.50-33 per kg, says MD, Dhampur Sugar

The government has hiked sugar minimum support price (MSP) by 7 percent to Rs 31 per kilogram from its earlier MSP of Rs 29/kg.

Gaurav Goel, MD, Dhampur Sugar said that with this increase in MSP, the price in North India would now go up from Rs 30.50-31/kg to Rs 32.50-33/kg over the next week to ten days.

As of now, cost per bag is Rs 31 per kg, and so this Rs 2 hike in MSP will add to the profitability, and as far as areas are concerned, as of January 31 they were Rs 20,000 crore and almost one-fourth of it will get cleared because of this hike, he said.

With regards to the capacity, he added the company would manufacture 7.5-8 lakh tonnes and expect to sell 6-6.5 tonnes this year. For sugar companies, every Rs 1 increase in the price would boost profits by Rs 70 crore.

On ethanol, he said they are currently at 300 kilo litre/day (KLPD) capacity and would be adding 100 KLPD more. Dhampur will add 50 KLPD expansion by February-end and another 50 KLPD by end of April.

He further added, the company has always been a buyer of molasses and the price for that is around Rs 200 per tonne in UP, which is same as last year.