Taking cue from dual pricing of electricity supply in some States, the National Federation of Cooperative Sugar Factories ltd (NFCSFl), an apex body that represents 262 cooperative sugar mills, has suggested dual pricing of sugar for industrial users and retail consumers in line with electricity and kerosene saying this will be a win-win for major stakeholders — farmers, millers and consumers. The NFCSFl has suggested that sugar rate to be kept at `50-60 per kg for industrial consumer and `30 per kg for retailers. Presently, sugar rate in retail market is `45-47 per kg.
This novel and "out-of-the box strategy" is need of the hour because "there is a new anti-sugar wave across the world which blames sugar to be the main cause of obesity, diabetes and heart-related ailments," NFCSF Managing Director Prakash P Naiknavare said in a statement.
"Thus, in the light of tough days ahead for sugar sales, it is perhaps the right time for all the major stakeholders of India's sugar sector to come together to push for dual pricing policy for domestic sugar," he said.
Besides, many developed countries have already imposed 'sugar tax' to artificially jack up sugar prices to discourage its consumption, he said. About 70 per cent of the total sugar is consumed by industries which are involved in manufacturing various products like beverages and biscuits, while merely 30 per cent is used by retail consumers.
"The dual pricing has already been implemented successfully in electricity supply for industrial and household consumers with separate rates. Even kerosene supplied under the Public Distribution System has dual rate for many years," it said. Naiknavare further said that the industrial bulk consumers have not reduced prices of their products when sugar rates remained lower for last 2-3 three years and thus "earned hundred per cent profit. ...This profiteering sailed through smoothly because nobody questioned this."
"The Federation will take up these issues with the government at an appropriate level," he noted. "The out of box" strategy is required to check the anti- sugar campaign. The dual pricing will ensure cane farmers get a remunerative price, sugar mills will have a bankable robust balance sheet and the common household consumer will get the sweetener at a reduced rate, he added.
Country's per capital consumption is about 28-30 kg, while the monthly sugar requirement of an average family of four members is only 10 kgs. sugar production in 2016-17 is likely to fall to 22 million tonnes, down 4.3 percent from an earlier estimate, as mills in its key producing state are closing early due to a cane shortage. Maharashtra had produced 8.41 million tonnes of sugar in the 2015-16 season, while country's total output was 25.1 million tonnes.