The government is considering a mechanism to enforce and verify stock declaration of sugar by mills, stockists and wholesalers to ensure sufficient availability through the year in coordination with the States amid expectations for lower production, though this will be more than consumption.

In September this year, an Order of the Food Ministry asked sugar mills to furnish details of the quantity of sugar sold in each month “in order to have complete data of stocks with sugar traders, dealers, wholesalers, big retail chains and processors to ensure sufficient availability at reasonable prices”.

“Though the Order was issued two months back, there was inadequate follow-up with the state governments. Similar to the wheat stock holding limit, states will be roped in to ensure proper verification of data submitted by stockists and wholesalers,” a senior official said.

According to the format shared, the mill has to furnish each buyer’s purchased quantity month-wise, along with PAN, GST and mobile number. However, the plan is to make self-declaration on either weekly or fortnightly basis on a designated portal, sources said.

India’s 2023/24 sugar supply might not meet domestic demand - USDA

According to government estimates, domestic consumption is likely to be 27.5-28 million tonnes (mt), against production of 29-30 mt, leaving a surplus of 1.5-2 mt in the current sugar season (October-September). The opening stock as on October 1 from last year’s carry-over was 5.7 mt, and the next season’s opening stock will be around 7 mt.

However, industry experts said much will depend on how much sugar is diverted for ethanol and how much export is allowed to friendly countries on diplomatic request. “Most mills have not started making ethanol from sugarcane juice as they await the declaration of a new price for the 2023-24 ethanol supply year (November-October),” an industry official said .

The government has said there are no plans to allow export of sugar in the 2023-24 season due to the tight supply situation. India had exported 6.1 mt of sugar in the 2022-23 season through permits issued to mills. Sugar export is only allowed with permits issued by the Food Ministry.