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Friday, July 20, 2001

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TN Sugar Fedn talks with exporters fail

M.R. Subramani

CHENNAI, July 19

TALKS between Tamil Nadu Co-operative Sugar Federation and the five bidders for its sugar export tender have failed.

``Our negotiations with the export firms are over. There was no meeting point between us,'' the federation sources told Business Line.

The federation had floated a tender to sell an unlimited quantity of sugar to cut its bulging stocks. The tender closed on June 29 with the bidding firms quoting low offers.

Though there was some improvement in the offers, it did not match expectations, the sources said. ``The maximum offer was Rs 10,500 per tonne and there was an offer below Rs 10,000 also. But we are not ready to sell at such low prices,'' they said.

In the tender, which had been re-issued after the original tender was passed on due to a similar response, the maximum price offered was Rs 10,200 a tonne.

The federation has a stock of five lakh tonnes. It offered S-30 grade sugar of two varieties -- one of less than 100 ICUMSA and the other between 100 and 150 ICUMSA.

The federation is looking for a price around Rs 11,000 a tonne, though it offers sugar for the public distribution system at Rs 12,200 a tonne (ex-factory). This is because it takes at least nine months to realise payment from the State Government.

Export sales fetch immediate cash and help the federation to save on interest besides ensuring prompt payment to growers.

Exporters, on the other hand, contend they cannot offer more than Rs 10,500-10,600 a tonne in view of the high ICUMSA value.

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