Rising sugar prices have affected businesses of leading sweet chains like Haldiram’s and Bikanerwala as their margins have squeezed and sales have slipped due to less demand.

“The profit margin in sweetmeat has narrowed down sharply owing to higher input cost, especially sugar,” Nathu’s owner Anil Gupta, said.

Price rise in sugar bothers us much as it is a main ingredient in preparing sweetmeats like burfi, rasgolla and gulab jamun, he said adding “We require sugar in large quantity.”

Sugar prices have increased by over 60 per cent to Rs. 35 a kg in the last one year as supplies are limited due to lower production. Sugar production is estimated to have come down to 15 million tonnes in 2008—09 from 26.4 million tonnes in the previous year.

Bikanerwala owner Shyam Sunder Aggarwal said, “Not only sugar, prices of ghee, khoya, paneer and milk have also gone up.”

Milk has become expensive and the full cream variety is being sold at not less than Rs. 28 a litre. While ghee and khoya prices have also risen by 15 per cent, Aggarwal said.

At present, khoya prices are ruling at Rs. 130 per kg.

Haldiram’s, another confectionery chain with outlets across the city, also expressed similar sentiments. “High commodity prices are affecting our margins and sales,” an official with Haldiram’s said.

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