Sugar Price to go Through the Roof

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Sugar Price to go Through the Roof

September 17: The price of sugar is estimated to reach more than Rs 100 per kg during this Dashain festival. The two state-owned companies – Salt Trading Corporation and Food Management and Trading Company Limited – that have been selling sugar at subsidized rate do not have stock of sugar for the festive season. This is why traders might increase the price of sugar at their will and the price of sugar can go through the roof.

At present, the Salt Trading Corporation has about 200 tons of sugar while the Food Management and Trading Company Limited has zero stock of sugar. Concerned officials have said that traders can seize this opportunity and arbitrarily fix the price of sugar. Not only the government company, but also the sugar producers' association does not have sufficient stock of sugar. The union currently has only about 6,000 tons of sugar in stock.

Brajesh Kumar Jha, divisional manager of the Salt Trading Corporation, said that traders are expected to fix the price of sugar up to Rs 110 per kg in the upcoming festival, showing the shortage of sugar. According to him, the government has not allowed the government company to buy sugar, which has made it easier for traders to fix the price of sugar of their choosing.

Pavitra Bajracharya, the outgoing president of the Nepal Retailers Association, also agrees with Jha’s statement. "In the next few days, the price of sugar will reach Rs 100 per kg and it is likely to go up further during the Dashain," he said. “At present, the retailers are buying sugar at a wholesale price of Rs 90 per kg. Adding the labor cost and labor charge, it costs Rs 95 per kg of sugar. We are now selling sugar to consumers at Rs 95, so we have to pay Rs 100. If the government fails to bring sugar by then, the price will go above Rs 100,” he told New Business Age.

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The government itself is to blame for the constant increase in the price of sugar. Consumers have been directly affected by the government's failure to allow timely purchase of sugar. The corporation had sent a letter to the Ministry of Industry, Commerce and Supplies about eight months ago seeking permission to import sugar at a concessional rate. The proposal has not been approved so far, which has caused problems in importing sugar.

The letter sent by the corporation seeking permission to import 30,000 metric tons of sugar is still pending at the Ministry of Finance. The Ministry of Finance has remained silent on this issue.

The corporation again sent a letter to the supply department last Friday seeking permission from the government to expedite the purchase of sugar.

Spokesperson for the corporation, Kumar Raj Bhandari, said that there is a strong possibility that the price of sugar would go out of control if the ministry ignores this issue.

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