Industry Odisha Bureau, Aug 29: The Centre will replace the monthly sugar quota system with fortnightly allocations from September. Mills must sell at least 40% of their allocation during the first week. The remaining quantity must be sold during the succeeding week. Officials said the change aims to improve demand-supply monitoring across sugar markets.
Physical verification of mill stocks revealed discrepancies with monthly return declarations. Some mills were found holding more stock than their declared monthly figures. Certain mills were also found short-selling against their monthly quota allocation. This meant mills sold less sugar than the quantity actually allocated.
The government also flagged delays between sugar sales and physical buyer lifting. In some cases, sugar sold early in the month reached buyers only later. This gap between sale and dispatch complicated the government’s market-monitoring efforts. Mills have now been directed to dispatch sold sugar within one week.
The fortnightly framework is intended to address these stock and dispatch mismatches. Shorter allocation cycles could give authorities more frequent monitoring opportunities. The government said this could help it respond quickly to market changes. Officials also said the system may help prevent artificial sugar shortages.
Additional flexibility remains built into the new allocation framework as well. The government said it can release extra quota whenever required. This provision could allow policymakers to adjust supply more responsively. However, actual quota releases will depend on prevailing market conditions.
On the production side, crushing operations are scheduled to begin October 15. Sugar production in October is expected to reach 10 lakh tonnes. November production is expected to be considerably higher, near 45 lakh tonnes. Mills will be permitted to sell sugar in October without restriction.
The fortnightly system reflects the government’s effort to strengthen sugar-market oversight. Closer monitoring could improve alignment between mill allocations and actual market sales. Still, effectiveness will depend heavily on accurate reporting and timely implementation. Buyer lifting behaviour and production levels will also shape eventual outcomes. The policy marks a notable shift toward tighter sugar-sector supply management.
