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By:

Rajendra Joshi

3 December 2024 at 9:20:26 am

Sugar industry strains as traders reap profits

Gap between ex-mill prices, retail rates raised questions Kolhapur: The Indian sugar industry is caught in a deepening crisis, with sugar mills struggling to secure remunerative prices for their produce even as traders and middlemen appear to be making substantial profits. While sugar mills are receiving between Rs 4,600 and Rs 4,800 per quintal through recent sale tenders, retail prices have remained as high as Rs 58 per kg. The widening gap between ex-mill prices and retail rates has...

Sugar industry strains as traders reap profits

Gap between ex-mill prices, retail rates raised questions Kolhapur: The Indian sugar industry is caught in a deepening crisis, with sugar mills struggling to secure remunerative prices for their produce even as traders and middlemen appear to be making substantial profits. While sugar mills are receiving between Rs 4,600 and Rs 4,800 per quintal through recent sale tenders, retail prices have remained as high as Rs 58 per kg. The widening gap between ex-mill prices and retail rates has raised serious questions about the role of intermediaries and the effectiveness of the Centre’s efforts to contain sugar prices. The margins available to traders and intermediaries have reportedly crossed 20 per cent, leaving sugar millers perplexed. At a time when both sugarcane growers and mill operators are under financial pressure, the trading chain appears to be benefiting disproportionately. The Centre must examine this growing disparity and take corrective measures to prevent speculative profiteering. Retail sugar prices began rising sharply in August, touching nearly Rs 70 per kg in some markets. The escalation added to inflationary pressures and caused concern among consumers, particularly ahead of the festive season. In response, the Centre introduced a series of measures to improve domestic availability and moderate prices. These included permitting duty-free sugar imports, initially until October 31, a deadline subsequently extended to December 31. The government also directed sugar mills to commence the crushing season from October 15 and tightened monitoring of sugar stocks. In another significant intervention, it modified the ethanol policy, restricting the diversion of sugarcane juice, sugar syrup and B-heavy molasses for ethanol production. Following these measures, sugar mills began witnessing a decline in the prices offered through their sale tenders. Recent transactions have fetched between Rs 4,600 and Rs 4,800 per quintal. Going by the conventional relationship between ex-mill prices and retail rates, sugar should ideally have been available to consumers at less than ₹50 per kg. However, retail prices continue to hover around Rs 58 per kg, pointing to a substantial disconnect between the mill gate and the consumer market. Traditionally, sugar retailing operated on relatively thin margins. Since sugar is an essential commodity, retailers often treated it as a low-margin product to attract customers who would subsequently purchase other household provisions. The margin was sometimes informally equated with the resale value of the empty 50-kg jute bags in which sugar was supplied. This was considered a nominal return for retailers. That traditional pricing mechanism, however, appears to have undergone a significant change. The widening gap between mill-level tender prices and retail rates has created considerable scope for intermediaries to extract higher margins. The critical question is whether the additional amount paid by consumers is reaching the sugar mills or remaining within the trading chain. The issue assumes particular significance in Maharashtra, where the sugarcane pricing dispute has intensified ahead of the new crushing season. Farmers’ organisations have been demanding a minimum price of Rs 5,500 per tonne for sugarcane. Millers, meanwhile, are preparing to agitate for a revision in the Fair and Remunerative Price (FRP) framework and the restoration of a more supportive ethanol policy. The Swabhimani Shetkari Sanghatana, led by Raju Shetti, has taken a firm position that sugar mills should not be allowed to commence operations until farmers receive an acceptable price for their cane. Shetti has also drawn the state government’s attention to the unusually high retail prices of sugar, questioning why consumers continue to pay more even as mills are forced to sell at relatively lower rates. The Centre’s sudden changes to the ethanol policy have further complicated the industry’s financial position. Ethanol production had emerged as an important revenue stream for sugar mills, enabling them to diversify operations, improve cash flows and enhance their capacity to pay farmers. Restrictions on the diversion of sugarcane-based raw materials have weakened this support at a critical juncture. The resulting contradiction is difficult to ignore: farmers are demanding better cane prices, millers are struggling with shrinking realisations and policy uncertainty, while intermediaries appear to be benefiting from the gap between wholesale and retail prices. The government cannot address the sugar crisis merely by regulating mill stocks, imports and ethanol diversion. It must also examine the entire supply chain, identify where the widening margins are accruing and ensure that the benefits of market interventions reach both sugarcane growers and consumers. With nearly Rs 2 lakh crore riding on the sugar economy, allowing intermediaries to thrive while the industry’s primary stakeholders struggle would be a serious policy failure.

Global Action Needed to Address Airlines Hoax Calls

Writer: Praveen Dixit
Praveen Dixit
Oct 28, 2024
2 min read

Updated: Oct 30, 2024

Airlines Hoax

Hoax calls pose a serious threat to aviation security. Over the last few weeks, India has witnessed dozens of such hoax calls. These calls appear to originate from anti-India Khalistan elements who are operating from Canada, the United States, and the United Kingdom. These threats are conveyed through various channels, including direct messages, emails, and social platforms, including X and Meta, and are orchestrated using platforms headquartered in the U.S. yet easily accessible worldwide. The spread and accessibility of these digital platforms have compounded the challenge of tracing and addressing these threats effectively.


Social media platforms, including X and Meta, must extend cooperation with countries like India in curbing posts such as hoax threats, promoting radicalisation in the name of religion, and luring individuals into risky investments like cryptocurrency. These platforms are rife with fake accounts, which must be systematically identified and eliminated. Additionally, strict verification processes should be implemented, ensuring only authenticated accounts can participate actively.


While countries like the U.S. and Canada already enforce robust regulations against harmful content, similar rules must be extended to India and other nations to prevent double standards. Failing to do so amounts to a tacit endorsement of digital anarchy in emerging economies, with platforms becoming breeding grounds for misinformation and societal disruption. If cooperation remains insufficient, India may be compelled to consider severe restrictions on these platforms, following the precedent set by countries like China, Russia, and Brazil, which have limited or banned access to certain social networks to protect public order and security."


Today, India finds itself increasingly targeted by hoax calls threatening its airlines, a form of disruption that could soon extend to other nations, including those considered technologically advanced. To ensure aviation security and prevent such threats globally, it is essential for every country to actively participate in and support comprehensive measures aimed at curbing this practice. In the unfortunate event of a disaster resulting from such a hoax, citizens from multiple nations would be impacted, underscoring the need for a unified, international approach to address this serious security risk.


Airports and airlines worldwide implement stringent measures to maximise aircraft security, leaving little room for unusual incidents. Despite these precautions, flights are still being diverted and grounded for additional security checks in response to potential threats. These diversions come at a high cost, not only resulting in financial losses amounting to millions of dollars but also consuming the valuable time of passengers. Such interruptions highlight the ongoing challenges in balancing robust security protocols with efficiency and passenger convenience.


Let’s hope that the owners of social media platforms exercise sound judgement and take decisive action against individuals engaging in these harmful pranks.


(The author is a former DGP of Maharashtra. Views personal.)

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