Ex-mill sugar prices fell nearly 30 per cent to Rs 47 per kg on Monday, from a peak of Rs 67 per kg on August 18, following a series of government interventions, but the drop has yet to filter down to retail shelves, industry sources said.
While the decline in ex-mill rates gets reflected almost immediately in wholesale markets, retail prices tend to lag.
Retailers who bought stock at the earlier, higher rates are unwilling to sell at a loss and will continue pricing their existing inventory at the older rate until it is exhausted, the sources explained.
A retailer typically holds 10-15 bags of sugar, each weighing 50 kg. Only once fresh stock is procured at the lower rate will retail prices adjust accordingly.
“It takes at least ten days to reflect changes in the retail price,” an industry source said.
On Sunday, retail sugar was selling at Rs 64.23 per kg, against a wholesale rate of Rs 59.72 per kg.
WHY EX-MILL PRICES FELL
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