Mill sugar prices have fallen by up to 17 rupees per kilogram. However, retail prices are only seeing a drop of 2 rupees, while the difference between mill and wholesale rates is only 2 to 3 rupees.
Why is sugar not getting cheaper?
The rise in sugar prices during the festive season has troubled the common man. People are eagerly awaiting a drop in sugar prices. Prices have fallen, but only by 2 to 3 rupees. According to the latest data from the Ministry of Consumer Affairs, the average retail price of sugar in the country has fallen from 65.08 rupees last week to just 62.57 rupees per kg. Surprisingly, the wholesale price of sugar has fallen by 17 rupees per kg.
No relief to the common man?
It's true that ex-mill sugar prices have dropped significantly, from 17 to 20 rupees per kilogram. Despite this, local grocery stores are selling sugar to the average person at just 2 to 3 rupees less.
According to government data, mill sugar prices have fallen from a record high of ₹67 per kg to a range of ₹47 to ₹55 per kg, but the national average retail price remains high at ₹62.57 per kg. According to the Indian Sugar Mills Association (ISMA) and NFCSF, the difference between mill and retail prices should be a maximum of ₹7 to ₹8, but the common man is still unaffected.
Why is sugar not getting cheaper?
Sugar prices at the retail level are not falling because wholesalers and retailers already have stockpiled sugar, which they purchased in mid-August at a high rate of 65 to 67 rupees per kg. Typically, a grocery store owner or small retailer purchases 10 to 15 bags of sugar at a time.
Now, since they purchased this old stock at the previous high rate of 65 to 67 rupees per kilo, no shopkeeper will sell at a loss, so they are not reducing prices until the old, expensive stock is gone.
Sugar mills have also clarified that the impact of falling ex-mill rates is immediately visible in the wholesale markets, but it takes at least 7 to 10 days for that cheap material to reach your nearest grocery store and for the complete change to be visible in the retail prices.
