New Delhi, Aug 24 (IANS) The recent rise in sugar prices cannot be attributed to ethanol production as India has sufficient sugar to meet domestic demand and maintains adequate buffer stocks, Padma Shri awardee Dr Bakshi Ram, agricultural scientist and former Director of ICAR-Sugarcane Breeding Institute, Coimbatore, said on Monday.

Speaking exclusively to IANS, Dr Ram said market sentiment, stockpiling and concerns being created around sugar availability were among the key factors behind the recent price increase. He stressed that there is no actual shortage of sugar in the country.

He said ethanol production is carried out under government oversight and decisions on the diversion of sugar for ethanol are taken after considering domestic sugar availability and stock levels. The government regularly decides the extent to which B-heavy molasses, C-heavy molasses or syrup can be used for ethanol production, depending on market conditions.

According to Dr Ram, the ethanol programme has instead strengthened the financial position of sugar mills and helped ensure timely payments to sugarcane farmers. Therefore, linking the current increase in sugar prices to ethanol production would be inappropriate.

“India produced around 30-31 million tonnes of sugar in the last season, while domestic consumption is around 27-28 million tonnes. In addition, the country maintains a buffer stock of around 6-7 million tonnes every year. There is, therefore, no actual shortage of sugar,” he said.

On the advisory to sugar mills to begin crushing from October 15, Dr Bakshi Ram said an early start would increase the availability of fresh sugar in the market, although it could have some impact on sugar recovery.

He explained that when crushing normally begins after Diwali, sugarcane tends to have a higher sugar content, resulting in better recovery for mills. However, starting crushing on or before October 15 would bring new sugar into the market earlier and help ease supply concerns.

“If mills start crushing on October 15 or earlier, fresh sugar will become available in the market sooner. This will increase supplies and could also discourage stockpiling, thereby reducing pressure on prices,” he said.

Dr Bakshi Ram recalled that a few years ago, sugar production had significantly exceeded domestic requirements, leading to a sharp decline in prices. The situation had affected the financial health of several sugar mills, with some struggling to make timely payments to farmers.

–IANS

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