Business Daily from THE HINDU group of publications
Monday, Jun 04, 2007
ePaper
Business Daily from THE HINDU group of publications Monday, Jun 04, 2007 ePaper |
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Agri-Biz & Commodities
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Sugar Industry & Economy - Exports & Imports Sugar export sops: Overseas buyer real beneficiary Harish Damodaran
New Delhi June 3 If in edible oils, duty reductions have mainly helped foreign suppliers, in the case of export incentives for sugar, the real beneficiary has been the overseas buyer. Since March, both the Centre and some State Governments have announced various sops for mills to export sugar.
Export sops
While the Centre is providing assistance of Rs 1,350-1,400 per tonne towards defraying costs of internal transport, marketing and port handling, Maharashtra and Karnataka have pledged additional support of Rs 1,000 per tonne, besides exempting mills from paying purchase tax on cane.
Low prices quoted
But rather than boosting exports, these measures have mainly emboldened millers to quote lower prices in order to dispose of their piled-up inventories at any cost. Sugar shipments from Tuticorin are currently quoting at around $270 per tonne free-on-board, representing a decline of $75 since January.
From Tuticorin
The gainer from all this has obviously been the large global buyer, who have forced factories to undercut one another. This story of losing out on both imports and export fronts is nothing new to the country. During 2002-03 — the days of overflowing public stocks — wheat was being exported from Food Corporation of India's (FCI) godowns at $90-95 per tonne f.o.b. Now, for replenishing the same FCI's depleted granaries, the Centre is having to consider importing wheat at $260 per tonne plus!
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