Mapping Out Sugar Decontrol
Government plan
- End current system of monthly quota of sugar release by mills
- Entrust states with responsibility to procure “levy sugar" for PDS
- Free farmers from selling cane only to designated mills
- Ease export/import restrictions
Pitfalls
- With no government control, mills can manipulate market price
- Need a clear buffer stock policy, else government intervention will be limited
- Farmers, cane output will remain vulnerable without clearer price policy
Potential Impact
- Mills will benefit, particularly those investing in new technologies
- Unless there is surplus, retail prices to be influenced by global trends
- A clear Exim tariff policy will free mills, consumers from political whims
- Without removing inter-crop price distortions, no...
