CHENNAI: Sugar prices in Tamil Nadu have risen to an all-time high, with one kilogram costing Rs 67 due to alleged hoarding by sugar factories in Uttar Pradesh and Maharashtra, according to a Malaimalar report.
The main reason cited for the unprecedented rise in sugar prices is the hoarding of sugar by factories in Uttar Pradesh and Maharashtra, which supply sugar to Tamil Nadu. The situation has been attributed to a significant decline in sugarcane production in the two states due to irregular monsoon rains.
Adding to the pressure on sugarcane supplies, the increase in crude oil prices has led to greater demand for ethanol, which is extracted from sugarcane to produce E-20 petrol.
Meanwhile, the approaching festive season is expected to further increase demand for sugar. Sugar mills are stockpiling sugar in anticipation of increased demand for making sweets during festivals such as Vinayagar Chaturthi, Navratri and Diwali, the report added.
Due to the alleged hoarding, sugar, which was sold at Rs 45 per kg last month, is now being sold at Rs 67 per kg.
Amid the rising prices and concerns over low sugar stocks in India, grocery wholesalers have urged the government to take immediate action against those involved in sugar hoarding.
“The government should take immediate action and control sugar hoarding. Moreover, since the sugar stock in India is low, the sugar price will be brought under control only if sugar is imported from abroad,” said Samuel Raj, a wholesaler from Koyambedu.