Sugar price soars ahead of festivals

By Laxman Kafle

Kathmandu, Sept 19 : As the great festivals of Dashain and Tihar approach, the price of sugar in the market has increased sharply. 

Every year, during the time of high consumption of sugar such as Dashain and Tihar, traders increase the price of sugar for one reason or another. Because of this, the consumers have been hit financially.

According to Raju Maskey, secretary at the Retail Trade Association, wholesalers have increased the wholesale price of sugar up to Rs. 130 within a month.

The price of sugar per kg increased from Rs. 105 to Rs. 130 within a month. Earlier on August 18, the retail price of sugar per kg was Rs. 105. The price of sugar has increased by Rs. 25 per kg within a month.

"The wholesalers have increased the price of sugar as a monopoly," said Maskey. He said, "When talking about why the price has increased so much, they said that the main reason behind the increase in the price of sugar in Nepal is the increase in the import price of sugar."

However, some retailers are selling the sugar they have in stock at Rs. 110 per kg, he said. "After the stock runs out, the retailers have to sell according to the wholesale purchase price, so one kilo of sugar should be sold at Rs. 130," he said.

Maskey said that there was no hand of retailers behind the increment of sugar price.  Basudev Dotel, of Suryabinayak, Bhaktapur, said that he brought a kilo of sugar at Rs. 125 per kg on Sunday.

He purchased a kilo of sugar at Rs. 105 per kilo three weeks ago. "I was surprised when I heard that the price of sugar went up by Rs. 20 per kilogram in three weeks," he said. "It is not unusual for the price of sugar to increase as the festival is approaching this year. Every year, during festivals like Dashain and Tihar, when the demand for sugar is high, the wholesalers increase the price of sugar by showing this or that reason," said Maskey

The annual demand for sugar is about 270,000 tonnes. But in one month of Dashain and Tihar, around 30,000 tons of sugar is consumed. A maximum of 140,000 tonnes of sugar is produced annually within the country. Annually, there is a shortfall of 130,000 tonnes of sugar from domestic production.

He said that there was no shortage of sugar in the market even though its price increased. He asked the government to intensify market monitoring over the sudden price hike of sugar and take action if the traders are found guilty. Govt. allows to import 20,000 tonnes of sugar in customs concession

Usually, when the stock of sugar sold by the Salt Trading Corporation runs out and it stops selling to the retail traders, the private sector traders increase the price of sugar in the market. After STC stopped selling sugar to customers, the price of sugar reached more than Rs. 115 per kg during Dashain last year as well. The sugar price dropped to Rs. 100 per kg after festival.  According to the instructions of the government, STC imports sugar at a customs discount and sells it to consumers and traders.

The government aims to curb artificial price hikes by allowing STC and Food Management and Trading Company (FMTC) to import sugar at customs concessions.

The government has not given permission to purchase additional sugar even though the stock of sugar at the STC has been running out for the last three years.

Recently, the government has decided to import 20,000 tonnes of sugar at a 50 per cent customs discount to prevent shortage during the festivals. Slim chance to bring sugar before festival

Information officer of STC Kumar Raj Bhandari said that after three years, STC has now got permission from the government to import sugar with customs concession.

According to him, the STC has stopped the sale of sugar imported at customs discount to retailers for the last two years which led to increased prices in the market.

He, however, said that it is still selling sugar to customers at Rs. 97 per kg from its outlets.  The Corporation is selling 1-2 kg sugar per person from its outlets.

Stating that the STC management is holding discussion with the Ministry of Industry, Commerce and Supplies for the import of sugar recommended, he said that they would import sugar at the earliest by completing all procedures.

"We have started the procedures along with the government's decision regarding sugar imports. The tender process will advance in fast track after receiving the formal letter on sugar import from the Ministry of Industry, Commerce and Supplies," he said. He, however, said that it will take at least one and a half months to bring sugar into the country by completing all procedures on the fast track basis.