Salt Trading Corporation Running Low on Stock of Sugar

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Salt Trading Corporation Running Low on Stock of Sugar

February 21: The Salt Trading Corporation has been selling sugar only in retail quantity due to the fear of running out of stock. The state-owned corporation has been doing so to prevent shortage of sugar in the market while it seeks government’s approval for additional purchase. It has been learnt that the government has been denying permission to the corporation to buy additional sugar.

The corporation has only about 500 metric tons of sugar in its stock.

“There wouldn’t be any sugar left if we had sold all of them,” Kumar Raj Bhandari, general manager of the corporation, told New Business Age. He said if they had sold the sugar as per the demand of the dealers, the stock would not even last for a day. He further said that such problem is prevalent since years.

The corporation has been facing shortage of sugar during the time of harvesting sugarcane as big traders and private companies do not want to supply sugar produced within the country to the corporation. Stakeholders say that the state-owned company is not supplied enough sugar during the harvesting season which makes it easier for traders to hike prices and manipulate the market.

The corporation had sent a letter to the Ministry of Industry, Commerce and Supplies (MoICS) seeking permission to buy 30,000 metric tons of sugar before Dashain. However, the company has not been granted permission for the purchase yet. The corporation says this has directly benefitted the local traders.

The traders have been charging customers between Rs 85 to Rs 90 per kg of sugar. “The retail price of sugar is Rs 85, but some of small traders are selling a kilogram of sugar for as high as Rs 90,” said Rajkumar Shrestha, president of Nepal Retailers Association. According to him, the price should have been less now as it is the harvesting season. He further added that the price has not gone down because the state-owned company does not have enough stock of sugar.

The MoICS, which has not given permission to the company to purchase sugar since a long time, has been delaying the purchase stating that as it is the sugarcane harvesting season and the permission will be given only after analyzing the output of domestic production.

 Stakeholders say that normally around 30,000 metric tons of sugar is consumed every month in Nepal. Only during festivals like Dashain, Tihar and Chhath, it is estimated that around 70,000 metric tons of sugar is consumed. According to the government data, 180,000 metric tons of sugar is produced by Nepali sugar industries in a year, while sugar is imported from India and other countries if the locally produced sugar is not sufficient to meet the demand.

 

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