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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.

HC: Builders want to ‘bite the cherry’; fined Rs. 1 lakh

Quaid Najmi
Apr 1, 2025
3 min read

Mumbai: In a stinging observation, the Bombay High Court said that some builders wanted to “bite at the cherry” when they failed in one of a bunch of petitions filed by cooperative housing societies (CHSs) in Bhayander (Thane) seeking ‘unilateral deemed conveyance certificate’.


Coming down heavily on the two concerned builders – Janata Housing Pvt. Ltd. (JHPL) and its sister-concern Sheth Land Development Corporation (SLDC) – Justice Sandeep V. Marne sharply noted that the latter was seeking “another bite at the cherry” in the Divine Blessings CHS case, in the Jesal Park residential layout.


The judge said that both JHPL and SLDC appear to be ‘promoters’ in the project and so, cannot ‘split’ themselves by filing multiple petitions challenging the earlier orders of the Thane Cooperatives Department District Deputy Registrar & Competent Authority (DDR&CA) on the societies’ demand for unilateral Deemed Conveyance.


Later, the Divine Blessings CHS was granted the unilateral Deemed Conveyance, but the builders challenged it, leading to the current order.

Incidentally, official sources reveal that the JHPL-SLDC have reportedly challenged the critical document granted by  DDDR-CA to around a dozen local societies.


“The court does not appreciate the conduct (of the builder) in keeping the Respondent-Society in the continuous course of litigation by filing multiple proceedings raising the same issues…. The petition is gross abuse of process of law,” ruled Justice Marne, slapping a fine of Rs. One-Lakh on the builder as costs to the Society payable within a month.


In a similar vein, Justice Marne reversed a contentious order of the Thane DDR&CA Kishore N. Mande (on March 28, 2024), rejecting several applications by a bunch of CHSs seeking ‘unilateral Deemed Conveyance certificate’.


The landmark verdicts in these separate but related matters, could benefit nearly a 100 such Societies in Bhayandar and many hundreds more in Maharashtra, said experts.


Coming to the aid of the beleaguered Society members awaiting redevelopment, on March 20, 2025, Justice Marne provided relief to “Vandana”, “Prarthana”, “Prerana” and “Upasana”, all CHSs, located in the 40-year-old Jesal Park layout, adjacent to Thane Creek.


Council for Protection of Rights (CPR) President and Barrister Vinod Tiwari lauded Justice Sandeep Marne' “courageous verdict which is a severe warning” to all crooked builders and conniving government officers.


"Due to this evil nexus, hundreds of revamp projects are stuck in Mumbai and other big cities, spelling misery for lakhs of society members," Tiwari told The Perfect Voice.


Hailing the judgement, the four societies’ Coordinator Pankaj Gupta, claimed it will green-light the Deemed Conveyance and allow revamp of these and other dilapidated old buildings, which languished for years thanks to multiple litigations for flimsy reasons.

 

Gupta said the judgement is a boon to all CHSs desperate for redevelopment, but are stuck in avoidable legal quagmire, mostly initiated by the conniving builders-officials, to harass the society members.


In the judgement, Justice Sandeep V. Marne said that one of the reasons cited by the Thane DDR&CA of Cooperative Societies, for rejecting the application for unilateral Deemed Conveyance was ‘incomplete layout’.


However, once the Occupation Certificate is issued to the building constructed in the layout and a CHS formed, then the Society can ask for unilateral Deemed Conveyance, said the judge.


The judge alluded to a GR (June 22, 2018) which clearly indicates granting of unilateral Deemed Conveyance of the land and building where several buildings are under construction on a single plot or work on all has yet to be completed.


The high court overturned the DDR&CA’s ground for rejecting the unilateral Deemed Conveyance that the sanctioned plan copy was not ‘legible’, saying the CHSs could have been easily asked to produce a clearer copy of the same.


On the DDR&CA argument of an alleged ‘mismatch’ of the area in the Certificate of Architect – Justice Marne said the architect or the builder could have been asked to submit a fresh Certificate.


Setting aside the order (March 28, 2024), the judge remanded the four CHSs’ proceedings back to the DDR&CA to decide them, as per the GR (June 22, 2018), and give full opportunity to the aggrieved societies plus the developer along with the relevant documents submitted by them.


Counsel Bishwajeet Mukherjee and Advocate Humera Syed appeared on behalf of the middle-class petitioner-Societies – unitedly fighting against the powerful builders JHPL and SLDC.

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