Government's major decision on sugar ahead of Diwali; traders to get relief until December 31..

The Government of India has extended the deadline for the duty-free import of one million metric tonnes of raw sugar. Importers can now bring in raw sugar without paying duties until December 31, instead of the previous deadline of October 31. This was announced in an official notification issued on Thursday, October 22. The decision provides relief to importers who were previously required to complete their imports within the earlier deadline. This move grants importers an additional two months to arrange for the procurement and supply of the commodity.

Keeping a close watch on sugar prices and supply, the government has further reduced the stock limit for traders. Traders are now permitted to hold a maximum of 1,000 quintals of sugar. This rule will remain in effect from October 15 to November 30. Previously, in August, the stock limit was set at 4,000 quintals, which was then reduced to 2,000 quintals effective September 15. Under the new regulations, traders are also required to sell their sugar stock within 30 days of receiving it.

Government move to curb hoarding
The objective behind lowering the sugar stock limit is to ensure continued availability in the market and to prevent hoarding. This will prevent traders from accumulating excessive quantities of sugar. The government expects this measure to curb speculative trading in sugar and alleviate unnecessary pressure on market prices.

How much have sugar prices declined?

According to the Ministry of Food, average retail sugar prices have fallen by approximately 15% since reaching a peak in August. Meanwhile, prices at the sugar mill level have dropped by nearly 28%. The Ministry has indicated that prices may soften further in the coming period. Through these measures, the government aims to ensure an adequate supply of sugar in the market, thereby providing relief to ordinary consumers. Monitoring Supply and Sugarcane Yield

The government has directed sugar mills, traders, and wholesalers to ensure a consistent supply of sugar in the market. Furthermore, they have been advised against hoarding stocks, which could create an artificial shortage. Mills have also been instructed to commence sugarcane crushing based on the weather and agricultural conditions in their respective regions. Additionally, the government will monitor the impact of reduced rainfall—linked to the El Niño phenomenon—on sugarcane yields in certain areas, with the objective of ensuring that consumers can access sugar at reasonable prices while also safeguarding the interests of farmers.

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