Stock Market

Govt fixes maximum stock limits for sugar traders

Govt fixes maximum stock limits for sugar traders

To check rising sugar prices, the Centre has directed traders not to hold sugar stock of more than 10,000 quintals in Kolkata and 5,000 quintals in other parts of the country.

The Cabinet had on April 28 approved a Food Ministry’s proposal to empower state governments to impose stock holding limits on sugar traders. The Ministry has now fixed the maximum stock limit through a notification.

As per the stock limit order, a dealer can stock up to 10,000 quintals of sugar in Kolkata, which is the largest trading centre for the commodity in the country. However, the limit is 5,000 quintals for rest of the country.

While the Centre has prescribed the maximum quantity a trader can keep, states are free to lower it. It also prescribed that a trader has to sell his stock within 30 days from the date of receiving the sugar.

Retail sugar prices have crossed Rs 40 per kg in most places due to likely fall in domestic production due to back-to-back drought.

Sugar production of India is likely to decline to 25 million tonnes in 2015-16 marketing year (October-September), as against 28.3 million tonnes in the previous year. So far, mills have manufactured over 24 million tonnes.

The closing stocks is expected to be 7 million tonnes despite fall in production as the country had bumper output in the last 5-6 years.