India agrees to export 3.75m tonnes of sugar
NEW DELHI, April 7: Indian mills have agreed contracts to export 3.75 million tonnes of sugar since the current marketing season began on October 1, a leading trade body said on Monday.
Of the total, mills have already shipped out 2.86 million tonnes, Praful Vithalani, president of the All India Sugar Trade Association, told Reuters.
India's top four sugar export destinations were Iran, Somalia, Malaysia and Sri Lanka, Vithalani said.
"We believe that India will be able to export between 4.3 million and 4.5 million tonnes of sugar this year."
His estimates are in line with the forecast of a senior industry official who on March 23 told Reuters that Indian mills looked likely to export 4.5 million tonnes in 2019-20, down almost a fifth from an earlier estimate.
But a 21-day lockdown imposed by India on March 25 to prevent the spread of the coronavirus has triggered a severe labour shortage, slowing down port operations and hampering the movement of goods.
"There were hiccups. And traders are still facing difficulties in transportation and the processing of papers. But the situation has improved of late due to a series of steps initiated by the government," Vithalani said.
"More or less, exports should be okay, but the next couple of weeks will be crucial," he said.
Lower sugar exports from India, the world's biggest producer of the sweetener, could buoy benchmark global prices in New York and London.
On Friday, May raw sugar settled up 2 cents, or 0.2per cent, at 10.31 cents per lb, rising for the second consecutive session, and May white sugar settled down $4.10, or 1.2per cent, at $336.50 a tonne.
Years of bumper cane harvests and record sugar production have hammered Indian sugar prices, making it hard for mills to pay money owed to farmers, who form an influential voting bloc.
To reduce that debt and pare rising inventories, New Delhi has approved a subsidy of Rs 10,448 ($145) a tonne for exports of 6 million tonnes in the 2019-20 season.
India had set an export target of 5 million tonnes for 2018-19, but mills managed to export only 3.8 million tonnes despite incentives provided by New Delhi. -Reuters