Indian mills have shipped out the entire 6.1 million tonnes of sugar allowed for exports, industry officials told Reuters, cashing in on multi-year high prices in the world market and robust demand.
The world’s second-biggest producer of the sweetener is, however, unlikely to allow additional exports in the current marketing year ending on Sept. 30, due to a likely drop in production.
This could lift global prices and allow top producer Brazil to sell more sugar on the world market.
“The mills have shipped the entire allocated quantity, and nothing has left since global prices became attractive,” Prakash Naiknavare, Managing Director of the National Federation of Cooperative Sugar Factories Ltd, told Reuters.
Mills were getting more than 50,000 rupees ($604.6) per tonne from the overseas sale against the local price of 36,500 rupees, dealers said.
A rumour earlier this month that India could ban exports prompted mills to accelerate the remaining shipments, he said.
The country exported a record 11 million tonnes of sugar in the previous 2021-2022 season, but New Delhi allowed exports of only 6.1 million tonnes in the current year due to an expected drop in production.
Production is likely to fall to 32.8 million tonnes in the current year, from a record 35.8 million tonnes in the previous season.
The drop in the production has closed the window of additional exports, which mills were seeking earlier, said a senior industry official, who declined to be named.
“We are now not demanding the government to allow more exports in the current season. We know it’s not possible,” he said.
India mainly exports sugar to Indonesia, Bangladesh, Malaysia, Sudan, Somalia and the United Arab Emirates.
Asian and African buyers have shifted to Brazil from India as the south American country has ample surplus for exports, said a Mumbai-based dealer with a global trade house.