Lok Sabha Question No. 3409 (UNSTARRED), answered on 2016-12-06
Subject: Production Cost of Sugar
Ministry: CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION
Asked by: C.S. PUTTARAJU, PONNUSAMY VENUGOPAL, P.R. SUNDARAM

## GOVERNMENT OF INDIA

## MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION

## DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION

## LOK SABHA UNSTARRED QUESTION NO. 3409 TO BE ANSWERED ON 06 th  DECEMBER, 2016

## PRODUCTION COST OF SUGAR

3409. SHRI C.S. PUTTA RAJU: DR. P. VENUGOPAL: SHRI P.R. SUNDARAM:

Will  the  Minister  of  CONSUMER  AFFAIRS,  FOOD  AND  PUBLIC DISTRIBUTION miHkksDrk ekeys] [kk| vkSj lkoZtfud forj.k ea=h be pleased to state:

- (a) whether  the  Government  has  imposed  stock  limits  on  sugar  mills during the festival sesson till October end due to spiraline price of sugar and if so, the details thereof;
- (b) whether this is the first time that the Government had imposed curbs on  the  Rs.  80000  crore  sugar  industry  ever  since  it  was  partially decontrolled in 2013 and whether as per the decision, mills should not at the end of September, hold more than 37% of their total sugar available with them during the entire 2015-16 marketing year and if so, the details thereof;
- (c) whether there is any requests and suggestions from various sugarcane farmers association and also from State Governments for the pricing policy on Sugar and sugar related products and if so,  the list of measures taken by the Government in this regard;
- (d) whether the Government has any proposal or request to increase the MRP for sugarcane in the country and if so, the details thereof and the measures  taken  by  the  Government  to  control  and  monitor  the  sale  of sugar and sugar related products by multinational companies in India along with the steps taken to protect the interest of the small scale sugarcane farmers, vendors and traders; and
- (e) the details of production cost of sugar in the country, State/UT-wise, indicating the State' where production cost is the highest?

## A N S W E R MINISTER OF STATE FOR  CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION (SHRI C. R. CHAUDHARY)

- (a)  & (b):  Stock holding limits were imposed for  the first time on sugar mills since de-regulation of sugar sector directing them not to hold stock of sugar in excess of 37% and 24% of the total sugar available with them during 2015-16 sugar seasons; respectively for the months of September and October, 2016.

(c): No,  Madam.  The  Central  Government  has  deregulated  the  sugar sector in April, 2013 by removing the levy obligation on sugar mills and dispensing with the regulated release mechanism of open market sale of sugar.  Also prices of sugar and sugar related products are now market driven and not subject to any pricing policy of the Government. (d): No, Madam.  The  Government  has  already  fixed the Fair and Remunerative Prices (FRP) of sugarcane for the sugar season 2016-17 at Rs. 230 per quintal at basic recovery rate of 9.5%. The FRP is the minimum bench mark price below which sugar mills cannot purchase cane from the cane growers. As regards sale of sugar and sugar related products, it is market driven and independent of Government control.

(e): The  production  cost  of  sugar  depends  upon  various  factors  like availability of adequate raw material, recovery from sugarcane, duration of the season, plant size, efficiency of plant, diversification of product mix, State  Advised  Price  of  sugarcane,  cost  of  working  capital,  managerial efficiency etc. Therefore, the production cost varies from factory to factory as  also  from  state  to  state.  The  Central  Government does not  maintain state wise cost of sugar production.

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