No proposal to ban sugar exports, says government official
Informist, Tuesday, Sep 26, 2023
By Sayantan Sarkar
MUMBAI – Rubbishing market talk that the Centre may impose a ban on sugar exports for 2023-24 (Oct-Sep), a government official told Informist that there is no such proposal on the table. "The chatter about a sugar export ban is completely rubbish as the market wants higher prices for the sweetener," the official said.
There have been concerns about a supply shortage in the next season as the Indian Sugar Mills Association, in its first estimate, pegged the country's sugar production at 31.7 mln tn, down 3.4% from the ongoing season.
The estimate considers sugarcane diversion of 4.5 mln tn for the production of ethanol. Moreover, the association has estimated domestic consumption in 2023-24 at 27.5 mln tn, which would leave a surplus of around 4.2 mln tn of sugar.
"The government will schedule a press conference to brief the media in due time if there are any developments on the matter," the official said.
India has so far exported only 6.1 mln tn of sugar during the current season ending Sep 30. Last year sugar exports were at a record 11.1 mln tn. ISMA had earlier said that it does not think that sugar exports will be banned altogether for the next season, starting Oct 1.
On Aug 2, ISMA had pegged Maharashtra's sugar output at 10.9 mln tn, down from 11.9 mln tn in 2022-23. Karnataka's output of the sweetener was pegged lower at 6.0 mln tn for the upcoming sugar season, as the state is likely to produce 6.7 mln tn this season.
The lower estimates were attributed to deficient rainfall in Maharashtra and Karnataka in August. The two states are among the top producers of sugarcane in the country, after Uttar Pradesh. India witnessed the driest August since 1901 with rainfall at 36?low normal during the month, according to data by the India Meteorological Department.
Ex-mill prices of sugar had risen 100–150 rupees per 100 kg in Jul-Aug, and had moderated slightly in September, traders said. Currently, the ex-mill prices of sugar in Maharashtra are quoted in the range of 3,730-3,952 rupees per 100 kg.
The government has also said it has adequate stocks of sugar to cover domestic demand for more than three months. The government said it has 8.3 mln tn of sugar as of Aug 31.
Informist had earlier reported that sugar stocks as on Oct 1 will be 4.5-5.5 mln tn, which traders said would be more or less sufficient to meet demand till sugarcane crushing starts in November. The crushing season typically runs from October to April, but this year mills in Maharashtra are likely to defer crushing by a month as patchy rains in August have affected growth of the sugarcane crop.
On Thursday, the Department of Food and Public Distribution asked sugar traders, retailers, wholesalers, big chain retailers, and processors to disclose stock positions every Monday with immediate effect in a bid to monitor prices.
Some traders, however, feel that there is no scope for exports of sugar next season. "There is no scope as estimates point to only 31.7 mln tn of output after diversion to ethanol," said Mukesh Kuvadia, secretary of Bombay Sugar Merchants Association, adding that with consumption pegged around 28 mln tn, the government may want to keep the rest as a buffer for domestic needs. End