Shares of sugar companies including Balrampur Chini Mills Ltd and Triveni Engineering & Industries Ltd fell 28 to 33% from their 52-week highs in April. These companies have invested in large projects to expand their distillery capacities, and a significant increase in ethanol prices would improve investor confidence.
The news came as a relief when a report said the government could raise the price of ethanol sold by sugar producers. The increase could be implemented on December 1, 2022. The increased use of ethanol has significantly boosted the growth of the sugar industry.
The top gainers in sugar stocks today:
|Action name||BSE Price (Rs)||win percentage||ESN Awards (Rs)||win percentage|
|Shree Renuka Sugars||50.55||1.61%||50.55||1.61%|
The biggest losers among sugar stocks today:
|Action name||BSE Price (Rs)||Loss percentage||NSE price (Rs)||Loss percentage|
|Shakti sugars||11:35 p.m.||-3.11%||11:25 p.m.||-3.53%|
|Dhampur Sugar Mills||233.45||-0.66%||232.70||-0.98%|
In a newspaper interview, Atul Chaturvedi, Chairman of Shree Renuka Sugars, said India should continue to export sugar as India has a sugar surplus. The best way to use this surplus sugar would be to produce ethanol or export it to other countries. It will also ensure that farmers get paid on time, and compared to other crops, sugarcane gives farmers better returns.
Stimulation of sugar activity
India exported nearly 11 million tonnes this year. In the coming year, it also plans to export around 8-9 million tons of sugar. Rains in sugar producing states like Karnataka and Maharashtra have been quite favorable. The export of sugar will also boost the rupee against the dollar.
India is the world’s largest producer of sweeteners and exported 11.2 million tons of sugar in the current year. As inflation continued to rise, to control prices it banned the export of wheat and sugar while importing crude oil from the international market.
The inflation report for August-2022 arrived on September 12, 2022 at 5:30 p.m. The National Statistics Office reported inflation at 7%, with food inflation at 7.62% and fuel inflation at 10.78%.
Currently, the international market is favorable to Indian raw and white sugar. Starting from the new season in October, the government started the procedure for exporting sugar to the international market. India will start exporting sugar in two tranches in October. The estimated amount for export is around 7 to 8 million tons, according to the report of a senior government official. The government will keep a check on the export of sugar as this could disrupt the domestic market price.