Exporters fear that a ban on sugar trade will make India seem unreliable.

By Riya R Alex | November 19, 2023

Sugar traders will approach the Indian government in March to ease export restrictions as they anticipate low production in this season. The traders will meet the government after an exact estimate of the total production for the present year by January, said Rahil Shaikh, vice chairman , All India Sugar Trade
Association.

India capped its sugar exports from June 1 with no end in sight after the weakest monsoon in five years rendered a low yield. To en-sure an adequate domestic supply this year, the government restricted sugar exports at 6 million metric tonnes (MMT) as an extension of a November 2022 Sugar Mill policy.

“We have exhausted our export limit already after the June policy kicked in,” said Shaikh, “Not a single grain of sugar has left India since then.” India needs a sugar output of 30 MMT to satisfy its domestic demand. Traders, however, project that the country will only produce 28 MMT this year.

“India has become an unreliable exporter. Our products are losing brand value due to lack of supply. We have lost our market that we took years to build,” said Shaikh. The world is moving towards other producers such as Brazil,European Union and Thailand as alternatives to Indian sugar, he added.

Sugar exports grew over eighteen-fold from 2017 to 2022, making India the second largest exporter of sugar. Traders, however, said the uncertainty and supply constraint in Indian exports has pushed global sugar prices up, and that sugar may be next on India’s list of banned exports after wheat and rice.