In line with market forecasts for the first tranche of the year, India approved the export of 6 million tonnes of sugar for the years 2022–2023.
In 2021/22, India shipped an all-time high of more than 11 million tonnes of sugar, and the sector anticipated that New Delhi will permit exports of 8 to 9 million tonnes of sugar this year in two tranches.
India is the second-largest exporter of sugar in the world and the largest producer.
According to a government statement, New Delhi has assigned 6 million tonnes of sugar to mills depending on their output during the previous three years.
On the basis of sugar production, industry representatives anticipated that the government would permit 5 to 6 million tonnes of sugar in the first tranche and another 2 to 3 million tonnes in the second tranche.
Although the letter sent out on Saturday did not specifically state whether the government would permit a second tranche, trade and government sources indicated that it was likely the case given that the nation’s production is on track to set a record for the second consecutive year.
An influential industry association predicted last month that India will produce about 36.5 million tonnes of sugar during the season that started on October 1.
“During discussion, the government has assured the industry that it would allow exports in the second tranche. That’s why the government has asked mills to export sugar before May end,” said a senior industry official, who declined to be named.
Prior to May 31, 2023, mills must export the designated quota either directly or through merchant exporters or refineries, according to the announcement.
Traders have already begun concluding export agreements as they anticipate receiving authorization to export 5 to 6 million tonnes of sugar this season.
According to Praful Vithalani, president of the All India Sugar Trade Association, “Indian sugar is flowing to numerous Asian, African, and Middle Eastern countries.”
“Due to brisk exports so far, it looks like that mills will be able to export 6 million tonnes of sugar by the time Brazilian supplies hit the global market,” he said.