Sugar export curbs and their impact

In News: The GOI has notified that sugar exports will be restricted, or allowed only with permission

• The government decided to “restrict” the export of sugar, effective from June 1

What are the latest curbs?

• The government has moved export of sugar from the ‘open category’, which requires no government intervention, to ‘restricted’ category.
• This means that export of sugar is allowed only with specific permission from the Directorate of Sugar, Department of Food and Public Distribution (DFPD), Ministry of Consumer Affairs, Food & Public Distribution.

Why the curbs now?

• The curbs, the first such move in four years, have been ordered to maintain “domestic availability and price stability of sugar”
• During the festival period of October and November, the demand for sugar increases and therefore, the Centre is committed to ensure availability of sugar for the lean period
• Also the global situation reflects a shortage of sugar, especially due to lower production in Brazil.
• This may trigger the demand globally and so as to safeguard domestic availability and interests, government issued an order to maintain domestic availability and price stability of sugar in the country during sugar season 2021-22.

Exports

Increase in exports

• Increase in export is because of the fact that Brazil produced more ethanol than sugar given the exceptional rise in fuel prices.
• This, and drought hitting other big sugar producers like Thailand helped India venture in countries which otherwise were dependent on Brazilian sugar.
• India is the second largest sugar producer in the world after Brazil. However, Brazil has always led in terms of exports.

Sugarcane

Climate

• • Sugarcane is predominantly a tropical crop. It requires hot (21°-27°C) and humid (75- 150 cm) climate.
  • Sugar beet (tuber crop) is the temperate alternative for sugarcane. It requires 10 to 18 months to mature depending upon the geographical conditions.
  • Too heavy rainfall results in low sugar content & deficiency in rainfall produces fibrous crop.
  • Temperature above 20°C combined with open sky in the second half of the crop season helps in acquiring juice and its thickening.
  • Short cool dry winter season during ripening and harvesting is ideal.
  • Frost is detrimental to sugarcane. It must be harvested before frost season in northern parts where frost is a common phenomenon.
  • On the other hand, hot dry winds like “Loo” are hostile to sugarcane. Both frost and loo are absent in South India. So south is ideal for sugarcane cultivation.
  • Coastal plains and western side of Western Ghats are generally avoided as the gusty winds (monsoon winds) damage the crop.

Soil

• • Sugarcane can tolerate any kind of soil that can retain moisture.

Manual labour

• • Cheap abundant labor is a prerequisite for successful cultivation of sugarcane

Production

• • India has the largest area under sugarcane cultivation in the world.
  • But in production India lags behind Brazil – world’s largest producer of sugarcane
  • Top Sugarcane Producing States: Uttar Pradesh > Maharashtra > Karnataka > Tamil Nadu > Bihar.

Sugarcane Pricing: Sugarcane prices are determined by:

1. Central Government: Fair and Remunerative Price (FRP)

• The Central Government announces Fair and Remunerative Prices which are determined on the recommendation of the Commission for Agricultural Costs and Prices (CACP) and announced by the Cabinet Committee on Economic Affairs (CCEA)
• The FRP is based on the Rangarajan Committee report on reorganizing the sugarcane industry.

1. State Government: State Advised Prices (SAP)

• The SAP are announced by the Governments of key sugarcane producing states.
• SAP is generally higher than FRP.

Commission for Agricultural Costs & Prices (CACP)

• The Commission for Agricultural Costs & Prices (CACP) is an attached office of the Ministry of Agriculture and Farmers Welfare, Government of India.
• The CACP is an expert body that recommends the MSPs of the notified Kharif and Rabi crops to the Cabinet Committee on Economic Affairs (CCEA).
• However, its suggestions are not binding on the Government.

Composition

The CACP is currently composed of five people. It consists of:

• A Chairman
• Member Secretary
• One Official Member
• Two Non-Official Members
• The two non-official members are usually representatives of the farming community and have an active association with the farming community.

Previous Year Questions (PYQs)

Q.1)With reference to the current trends in the cultivation of sugarcane in India, consider the following statements: (2020)

1. A substantial saving in seed material is made when ‘bud chip settleings’ are raised in a nursery and transplanted in the main field.
2. If bad weather conditions prevail when setts are directly planted, single-budded setts have better survival as compared to large setts.
3. Sugarcane can be cultivated using settlings prepared from tissue culture.

Which of the statements given above is/are correct?

1. 1 and 2 only
2. 3 only
3. 1 and 4 only
4. 2, 3 and 4 only

Source: Indian Express