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Sugar stock audit set to curb speculation, says NFCSF chief
India's physical sugar stock audit ending Aug 14 could ease prices; NFCSF says govt may release official number next week. Estimated carryover of 3.5m tonnes makes Nov tight, but early crushing may help.
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The Indian government is expected to release an official sugar stock number next week after completing a physical verification of every mill, a move that could help cool prices that have risen 8% in the retail market over the past month, according to Prakash Naiknavare, managing director of the National Federation of Cooperative Sugar Factories (NFCSF).
The government began the verification on July 24 and set an August 14 deadline, following a period of speculation that carryover stock at the end of the current season on September 30 would fall to about 3.5 million tonnes – enough for roughly six weeks of demand but a tight cushion for October and November.
"This is not a very natural spike, though it was expected in the months to come, not now," Naiknavare said, pointing to three factors behind the price jump: perceived scarcity that has reached all stakeholders, the likely impact of Super El Nino on next season's crop, and overselling of sugar against allotted quotas.
The All-India average wholesale price has eased to about ₹46/kg from roughly ₹48 after the government imposed a stock holding limit of 400 tonnes per trader through November 30, Naiknavare said. But retail prices in Delhi have moved higher, to ₹55-56/kg from ₹46-48/kg a month ago, according to Consumer Affairs Ministry data, which shows Delhi's average at ₹49/kg on August 12.