Sugar Exporters

India Contracts To Export 5.6 Million Tonnes of Sugar

Located in Asia, India is the largest sugar producer in the world and the Asian nation ranks second behind Brazil in terms of sugar exports. The Government of India (GOI) has granted the sugar mills of the country permission to export 6.1 million tonnes of sugar, by the end of May 2023. As per sources India has already signed contracts for exports of 5.6 million tonnes of the sweetener. 

Also, sugar dealers have already shipped approximately 2.5 million tonnes of raw and white sugar out of the total volume contracted. Based on data obtained from unknown sources, India has already exported equivalent quantities of raw as well as white sugar across the Middle East, Asia, and Africa. The selling cost of a raw variety of sugar ranges from $480 to $ 510 per tonne free on board (FOB), the white sugar is exported at a rate of $485 to $ 540 per tonne FOB. 

Role Of Government in Sugar Export 

Asian countries, Middle Eastern countries, and African countries are the major importers of Indian sugar. Such is the demand that in the last marketing season alone, India exported 11 million tonnes of sugar.

However, this year taking into account a significant dip in the sugar output, the government has lowered the export quantity of sugar to around 6.1 million tonnes. However, authorities said that they will review the data of local sugarcane production and take a look at the second tranche. 

To fix the export quantity is 2023, the Indian Government will assess the production of sugar next month. ISMA (Indian Sugar Mills Association) stated that in the current sugar season i.e. 1 October, sugar mills have generated 4% of extra sugar. In addition, farmers, traders, and millers also reported that the harvest of sugarcane will fall by approximately 7% due to unfavorable weather conditions. 

Thus, a dip in sugarcane production lowers the sugar output, which in turn curbs further export of sugar from India, leading to elevated global prices of the sweetener. As a fallout of high prices, Brazil and Thailand, the main competitors of Indian sugar are eyeing the opportunity to increase their shipments. 

Indian sugar mill owners cited that through exports, they gain 20% more in comparison to the domestic market. However, a global trader from Mumbai said that the Government could not allow extra export volumes due to lower sugar output. 

Conclusion 

India is considered a major Sugar Exporter due to consistent production as well as attractive prices. This year the country has the contract to export around 5.6 million tonnes of sugar to Asian, African, and Middle Eastern countries, out of the total volume of 6.1 million tonnes allowed by the GOI. However, the export amount has decreased as compared to the previous year due to erratic weather conditions and owing to lower sugar output, domestic millers believe that the government is unlikely to raise the sugar export quota for the current sugar marketing season. 

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REFERENCE 

https://bit.ly/3XSTpZy

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