Sugar imports remain economically viable despite falling domestic prices

Sugar imports remain economically viable for India despite a sharp decline in domestic prices over the past two weeks, according to industry leaders. Niraj Shirgaokar, President of the Indian Sugar and Bio-Energy Manufacturers Association (ISMA), said on Wednesday that falling domestic prices have not eliminated the economic case for bringing in foreign supplies.

Ex-mill prices have dropped significantly to Rs 43-44 per kilogram from a peak of Rs 65-67 per kilogram recorded just two weeks earlier, Shirgaokar said. However, the full impact of this price correction on retail sugar prices will take another one to two weeks to become apparent in the market, he added.

The government authorized duty-free imports of 10 lakh tonnes of sugar last month as part of a broader strategy to manage domestic supply and keep retail prices in check ahead of the festival season. Global sugar prices have firmed during this period, making India's position as the world's second-largest sugar producer particularly significant in the global market dynamics.

The import decision reflects efforts to balance domestic price pressures while ensuring adequate supply across the country during a season of heightened consumer demand. Industry observers are closely monitoring how domestic and global price movements will influence mill operations and import volumes in the coming weeks.