India Is Reconsidering Export Of Raw Sugar

Last month, India limited sugar exports to 10 million tonnes for the marketing season that runs through September, but now it is considering allowing the export of raw sugar.

Why the rethink: Exports were capped to prevent a surge in domestic prices amid high food inflation, but India now has stocks of raw sugar piled up in ports and warehouses.

• Sugar mills have requested the government to let them ship out unrefined stocks as they grapple with mounting stockpiles following the ceiling on exports.

• The stockpiles are estimated to run into about half a million tonne of raw sugar, including about two lakh tonnes stuck at ports across the country.

Raw sugar exports: Of India's record 10 million tonnes of sugar exports this year, raw sugar accounted for about 4.5 million, while the rest was white, or the refined variety.

• Over the past few years, India has been exporting reasonably large quantities of raw sugar, positioning itself as a consistent supplier alongside the key players Brazil and Thailand.

• Indian Sugar Mills Association wants to export raw sugar because it cannot be sold in the domestic market.

• Indian mills produce raw sugar only for the overseas refineries that turn 'raws' into whites.

Raw sugar in the international market: Raw sugar has been trading near its lowest in four months, but additional shipments from India can boost the market.

• Indian mills are also likely to benefit because there will be a lot of buyers, as Indian sugar is very competitive in the world market.

• They were facing difficulties of logistics after the sudden curb on sugar exports that prevented mills from shipping out raws.

Similar case with wheat export: India banned the export of wheat on 13 May, but under several exceptions, it has exported 1.8 million tonnes of wheat to a dozen-odd countries, including Bangladesh and Afghanistan.

• It is a good strategy — rather than imposing a blanket ban, India is regulating exports according to its needs.

• In this way, India is able to ensure its food security and limit inflation, as well as provide humanitarian assistance and stabilise international markets.

Sugar production in India: India has become the largest producer of sugar in the world, replacing Brazil.

• Sugar production in the current sugar season 2021-22 is expected to be 13 per cent higher than the previous sugar season.

• India produced about 310 lakh metric tonne (LMT) of sugar between 1 September 2021 and 31 March 2022 and the production is estimated to be 350 LMT in the ongoing season.