India to Extend Duty-Free Sugar Import Amid Shortage

India to Extend Duty-Free Sugar Import Amid Shortage (Update1) Share | Email | Print | A A A By Bibhudatta Pradhan and Thomas Kutty Abraham Sept. 24 (Bloomberg) -- India, the world’s biggest sugar consumer, will extend duty-free imports of the refined variety beyond the November deadline as demand outpaces supplies for a second year, Farm Minister Sharad Pawar said. Purchases at zero duty will be permitted until May or June, Pawar told reporters in New Delhi. Last month, the exemption was stretched until Nov. 30 for white sugar and until March 31 for the raw variety. Sugar has almost doubled this year, reaching a 28-year high on Sept. 1 in New York, as a drought in India and excess rain in Brazil, the top producers, ravaged crops. The South Asian nation will remain the largest buyer with a shortfall of 8 million tons in 2009-10 season, Czarnikow Group Ltd. said this month. India will begin the new marketing season on Oct. 1 with a combined raw and white sugar stockpile of 4 million tons, Food Secretary Alka Sirohi said Sept. 17. Arrivals of imported raw sugar and the white variety may be 2.4 million tons and 200,000 tons respectively on Sept. 30, she said. The South Asian country may rely on imports to meet almost a third of its demand of 23 million tons in the year starting Oct. 1, Narendra Murkumbi, Managing Director of Shree Renuka Sugars Ltd., the nation’s biggest refiner, said Sept. 1. Separately, the government will give a “serious thought” to paying rice growers a bonus for their crops, the worst hit by drought this year, Pawar said. Farmers will receive 950 rupees ($19.5) for 100 kilograms (220 pounds) for common grade rice, up from 900 rupees last year, the government said Aug. 20. The monsoon-sown rice production will fall 10 million tons from last year’s record as inadequate rainfall forced farmers to cut acreage by 6.1 million hectares, Pawar said last month. The government will ensure adequate supplies of seeds and credit to help increase the area for winter-sown crops including wheat and canola, Pawar said today. India, the world’s second-biggest wheat grower, aims to produce a near record 79 million tons of grain this year, the farm ministry said last week. It has set target for the winter- sown rice at 14.5 million tons and barley at 1.55 million tons. To contact the reporters on this story: Bibhudatta Pradhan in New Delhi at bpradhan@bloomberg.netThomas Kutty Abraham in Mumbai at tabraham4@bloomberg.net.