In what could come as a big boost for sugar companies, Indian Sugar Mills' Association (ISMA) told CNBC-TV18 that talks with the Indonesian government on allowing export of raw sugar are ongoing. Pramod Patwari, CFO of Balrampur Chini Mills, spoke at length about the lowering of import duties.

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"Lower Indonesian duties will help more raw sugar exports out of India," Patwari said on Thursday.

About exports, he said, “Last year the export quota announcement was around 5 million tonne and against that the country exported 3.5 million tonne. This year the quota is on the higher side at 6 million tonne and we are hopeful that we would be in a position to export 4-4.5 million tonne.”

As far as current pricing structure is concerned, Patwari said, “At this subsidy level and at current prices, the economics are not working but our view is that international prices are not going to remain at this level over a long period of time.”

“International markets need sugar and European Union, Thailand, Australia, Pakistan everyone is deficient or lower in production. India is the only country who can feed the international market. So at some point of time the international prices are expected to move up and that could happen in October-November,” he added.

"The current international sugar prices at Rs 20 per kg and expect a 10-15 percent hike," said Patwari.

On the domestic market front, the CFO said, “Minimum selling price as of now is around Rs 31 per kg. We are selling sugar more than Rs 34 per kg and in the monthly release mechanism, I do not think there is a significant risk of downsizing the prices.”

Talking about expansion, he said, "We are setting up a new ethanol distillery which will boost capacity by 40 percent."

First Published:Sept 12, 2019 10:51 AM IST