Sugar mills, which were allowed yesterday to export 5 lakh tonnes of sweetener, are expecting sales realisation from overseas sales to be about Rs 200 per quintal higher as compared to domestic rates.

“At present, the global prices are higher by about Rs 150-200 per quintal than the domestic rates. We hope to get about Rs 3,000 per quintal from exports,” Indian Sugar Mills Association (ISMA) Director General Mr Abinash Verma said.

He pointed out that global sugar prices were higher by about Rs 500 per quintal earlier this month, but since then it has fallen to about 700 dollars/tonne from 800 dollars/tonne.

The government had yesterday allowed sugar mills to export up to 5,00,000 tonnes of sugar under Open General Licence (OGL) as output is likely to exceed demand by about 2.5 million tonnes. Earlier, it had allowed mills to meet export obligations of about one million tonnes under Advance Licence Scheme (ALS).

Reacting on the Government’s decision to allow exports, Mr Verma said this would ensure sugar prices do not fall further in the domestic market and help mills in recovering their cost of production.

In the retail market of the national capital, sugar prices have fallen to Rs 30-32 per kg from nearly Rs 50 per kg in January last year.

India’s sugar production is estimated at 24.5 million tonnes in 2010-11 sugar year (October-September) against 18.8 million tonnes in the previous year. The annual demand is pegged at 22 million tonnes.

ISMA feels the country can export 1.5 million tonnes of sugar under OGL after taking into account one million tonnes of sweetener already exported under ALS.

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