India plans to export 1 million tonnes of sugar to handle domestic stock surplus | Stock Market News
Source: Live Mint
India is expected to issue the order to allow the export of 1 million metric tonnes of sugar in the current season to help clear the country’s surplus stock, reported the news agency Reuters, citing government and industry sources aware of the development.
India is the second-largest sugar-producing nation in the world after the South American giant Brazil. The nation exports volumes averaging 6.8 million tonnes per year.
This export decision is aimed to help support the local sugar prices in India, as per the agency report.
India’s move to sell 1 million metric tonnes of sugar can further pressure global sugar prices, according to the news report.
According to the report, the decision to allow the exports had been speculated for the past few weeks, and it comes as a surprise for some traders, as this year’s production is expected to fall below consumption for the first time in eight years.
In India, Maharashtra, Karnataka, and Uttar Pradesh makeup over 80 per cent of the nation’s total sugar production. With the lower sugarcane yields this year in these states the trade houses were prompted to reduce their output estimates for the current 2024-25 season.
The sugar production can drop to nearly 27 million tonnes, compared to 32 million tonnes in the previous year, below the annual consumption figure of nearly 29 million tonnes, according to the agency report citing trade houses.
“Next year’s production is likely to be quite strong, so allowing limited exports of 1 million tons is good news for the sugar industry,” Deepak Ballani, director general of the Indian Sugar and Bio-energy Manufacturers Association told the news agency.
India currently exports its sugar supply to countries like Indonesia, Bangladesh, and UAE. In the year 2023-24, India did not allow exports of sugar.
The Indian Sugar and Bio-energy Manufacturers Association, a producers’ body, also told the agency that the permission to export 1 million tons of sugar would help sugar mills reeling from low local prices. Sugar prices in India are hovering around their lowest level in the last year and year and a half, according to the agency report.
