Hindustan Times ST (Mumbai) - Live
Centre likely to keep lid on sugar exports as output dips
MUMBAI/NEW DELHI: India is not looking at allowing more sugar exports, government and industry officials said on Thursday, dampening speculation that the world’s biggest producer of the sweetener would permit a second tranche of overseas shipments.
India, the world’s biggest sugar exporter after Brazil, exported a record 11 million tonnes in the previous season to September 30, 2022.
But the government has allowed sugar mills to export only 6.1 million tonnes of the sweetener in the current season that began on October 1, 2022. Food price inflation was high at the start of the season, prompting curbs on exports.
But the authorities had said they could take a view on a second tranche of sugar exports after getting a clearer idea about local production.
Mills have already contracted to export about 5.6 million tonnes, and producers, traders and industry officials were expecting the government to allow an extra 2-4 million tonnes of overseas shipments.
But expectations of a drop in sugar output have dampened prospects of any additional exports during the current 2022-23 season, government and industry officials said.
Lower sugar exports from India could raise global prices , and allow rivals Brazil and Thailand to increase their shipments. “Sugar cane yields were far lower than last year. The production is not sufficient to permit additional exports,” said an official with direct knowledge of the matter. He did not wish to be named as he is not authorised to talk to the media.
“It is not possible to fulfil the industry’s demand of 3-4 million tonnes. We can’t allow even additional exports of 1 million tonnes,” said another official, who declined to be named.
Global trading houses were initially expecting that India would allow 8 to 9 million tonnes of sugar in the current year ending on September 30, 2023.
But adverse weather surprised the industry. The country’s sugar production was initially projected to rise to a record 36.5 million tonnes, far above local demand of 27.5 million tonnes. But now the production estimate has been cut to 34.3 million tonnes. Reuters was the first to report in December on the likely drop in production.