MEIR commodities’ managing director Rahil Shaikh has said that India is likely to sign several agreements for the export of sugar by December this year, with the production of the designated 60 lakh tonnes of sugar and the deliveries to be completed by March-end 2023. He asserted that there has been a “high demand” for Indian sugar in the international market.
Shaikh told The Indian Express that the maximum demand for the sugar export was from countries like China, Bangladesh, and nations in the Horn of Africa. “I think the contracts would be signed by December-end and 60 lakh tonnes of sugar would be exported by March-end,” he said.
In 2021, the country exported a record 112 lakh tonnes of sugar. As the Indian millers have been eying another year of good sugar export, the central government issued a mill-wise quota for the export, with an estimated 60 lakh tonnes of sugar to be shipped out in the first tranche. The industry, meanwhile, hopes that the government would allow the export of 20 lakh tonnes of sugar once the first batch is exported.
The rise in demand has, however, resulted in several sugar mills trying to or renegotiating their contracts for the export. The exporters pointed out that it was in a bid to command higher prices for the export. In the past, mills had signed contracts for sugar export at lower prices than the current amount. According to industry sources, following the increase in demand for sugar, prices in the international market have jumped a few cents, with a significant number of mills trying to and renegotiating their contracts. “This has had an effect in the international market. Other than a price rise, this can also cause problems for the future agreements,” said an exporter, requesting anonymity.
Meanwhile, the sugar season in Maharashtra and Uttar Pradesh has been racing way ahead. While it is early, the mills in Maharashtra have been considering a drop in per acre yield, which might affect the production figures at the end of the season.