Government fixes 24.5 LMT monthly sugar quota for sale in March 2019

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In a notification issued on 28th day of February 2019, the food ministry has allocated sugar quota for sale to each of 546 mills in the country.

The group sugar producing companies having more than one sugar producing units may maintain the stock as defined in Para (1) of this Order, either unit wise or for the group as a whole.

Besides, while allocating the maximum quantity of white/refined sugar for sale in the domestic market by the sugar mills during the month of March’ 2019, the quantity of sugar sacrificed/diverted due to production of ethanol from B-heavy molasses from October,2018 to December, 2019 has been included in the February, 2019 month end notional stocks. As such, from the month of March 2019 onwards sugar mills shall not be allowed to sell additional quantity, over and above the quantity indicated in column 4, on account of sacrifice due to the production of ethanol from B-heavy molasses.

As indicated in the stock holding limit order No. 5-1/2018 Sugar Control dated 31st October 2018, the sugar mills are required to export quantity of Minimum Indicative Export Quota (MIEQ) allocated to them for export during Sugar Season 2018-19. For this purpose, sugar mills are required to set their quarterly targets and intimate the same to DFPD. Further, if any sugar mill fails to intimate their quarterly exports target before the end of any quarter, the quarterly export quota will be deemed to be one-fourth of the total MIEQ of 2018-19 sugar season. The fulfillment of the quarterly export quota target, as the case may be, shall be monitored by DFPD based on actual export reported by the sugar mill through P-II return. In case, a sugar mill fails to achieve its quarterly sugar export target or deemed export target, the equivalent quantity of un-exported sugar during the said quarter shall be deducted in three installments from the quantity of sugar to be allocated to them in Column 4 of table of monthly stock holding limit order for each month in the subsequent quarter.

Besides, the production of raw sugar by the sugar mills has also been added in the February 2019 month-end notional stock. The total exported quantity up to January 2019 during current sugar season 2018-19 has also been added in the February 2019 month-end notional stock.

The sugar mill wise maximum quantity of white/refined sugar for domestic sale and dispatch during the month of March 2019 as given in column 4 has been worked out on the following parameters:

1. The March 2019 Stock holding limit has been prorated on the basis of giving equal weight, i.e. 50 % each to total sugar production of sugar during the sugar season 2017-18 and the month-end notional stock for the month of February 2019.

2. The notional month end stock for the month of February 2019 has been worked out on the basis of month end stock for January 2019 (as reported on P-II) adding expected production for February 2019 subtracting actual release for February 2019. For expected production of February 2019 production for the corresponding period of February 2018 has been taken into account. In case sugar mill has not been operational during February 2018, production for the month of January 2019 has been factored in. Besides, the total exported quantity up to January 2019 as reported in P-II has been added to January 2019 month-end-stock. The difference between expected production and actual production for the month of January 2019 has been adjusted while arriving in February 2019 in notional stock.

3. The deductions of sugar on account of non-export of sugar as per the quarterly targets for the first quarter from October, 2018 to December, 2018, fixed by the sugar mills or the deemed quarterly export targets as the case may be, have been made in respect of those sugar mills who have not exported any quantity of sugar against their quarterly targets for the first quarter i.e. October, 2018-December, 2018. No deduction has been made in respect of the sugar mills who have exported or partially exported their quarterly export quota (MIEQ) for the first quarter i.e. October, 2018 to December 2018 completely fulfilled their MIEQ obligation exported targets or the deemed export targets for the first quarter of the current sugar season 2018-19 as the case may be, have been incentivized by allocation of 25 % of the quantity deducted from the non-exporting sugar mills.

4. Show cause was issued to the sugar mills for violation of stock holding order for the month of November 2018. Except for 13 sugar mills, replies to SCNs have been received which are under examination. The excess quantity which has been sold by the said 13 sugar mills have been deducted from the proposed allocation in the month of March 2019.

5. The deductions and incentives taken into account while arriving at the figures given in column 4 of the table in the Order are indicated in the Annexure.

In the previous month the Govt. allocated quota to 531 mills in the country to sell 21 lakh MT. With higher quota compared to last month, supply in the market will increase which will be helpful for millers to clear cane arrears.

Link to March 2019 Monthly Sugar Quota, Govt. Notification

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