Sugar At Rs 100?

There is little doubt that food inflation has become a persistent phenomenon

- Sutanu Guru & Haider Ali Khan

At the end of the day, this headline could turn out to be an exaggeration. But the price of many food items has shot up so fast of late that anything seems possible, if not probable. After years of rising output, sugar production will see a sharp decline this year. Optimistic estimates peg sugar production at about 24 million tonnes this year. Realists say, no more than 22 million tonnes. Domestic demand would be more than 26 million tonnes.

Perhaps, sensing a looming price surge, the government recently imposed a tax of 20 per cent on sugar exports. Of course, officials and industry managers insist that Indian consumers will not have to pay through their nose for sugar during the coming festive season.

In a statement to BW Businessworld, the Indian Sugar Mills Association says, “As per preliminary estimates, in 2016-17 sugar output is pegged at 23.26 million tonnes. With an estimated opening balance of 71 lakh tonnes on 1 October 2016, sugar availability during the 12 months of next season will be 30.36 million tonnes, enough to meet the domestic sugar requirement of 26 million tonnes in 2016-17.”