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Sugar becomes bitterly costly

business Updated: Apr 30, 2009 02:17 IST
Avishek G. Dastidar
Avishek G. Dastidar
Hindustan Times
Sugar becomes bitterly costly

These are hard times for those with a sweet tooth. Hit by an unprecedented spike in prices, sugar is not so sweet for Delhiites anymore. From Rs 22 a month ago, the price of a kilo of sugar has risen to over Rs 35 at retail counters across the capital.

An unprecedented bad harvest in Uttar Pradesh and other parts of north India, due to poor weather in the winters, caused a huge demand and supply mismatch.

“Even wholesale prices seem to be moving towards Rs 30 per kg from the present Rs 23. So retail prices may soon go past Rs 40 per kg,” said Vijay Prakash of the Delhi Grain Merchants Association.

To prevent the price hike from hurting it at the polls, the Congress-led UPA government has asked Kendriya Bhandar (KB), Delhi’s state-run retail chain, to sell cheap sugar loose — a first for this enterprise.

The Delhi government has directed traders to not store more than 2,000 quintals of sugar.

But the price increase has not spared KB either. Although it buys sugar directly from the mills, KB’s packed sugar now costs Rs 29 a kg.

“Buyer sentiment is getting affected,” said Jagdeesh Bhatia, managing director, KB. “The rise (in prices) started earlier this month. Eighty of our outlets will sell sugar loose.”

The BJP has already turned the price rise into an election issue in Delhi — candidates from New Delhi and Chandni Chowk constituencies mentioned it in their recent meetings.

“The government did not take protective measures to prevent this rise,” said Vijay Goel, BJP candidate from New Delhi. “They are still offering a knee-jerk reaction.”