Sugar mills contract export deals for 34 lakh tonne

Indian sugar mills have contracted deals for export of 34 lakh tonne of the sweetener, according to trade body All India Sugar Trade Association (AISTA). Around 17 lakh tonne have already been dispatched from sugar mills to the ports and refineries, the association said.

Indian exports are still competitive in the global market and are enjoying some advantage in view of the problems Brazil is facing in shipping soybeans that could extend to sugar, industry people said.

Since the Centre has announced an incentive of Rs 6,000 a tonne for sugar exports, at least 34 lakh tonne have been contracted for shipments abroad. The Centre has allocated Rs 3,500 crore this season as incentive for exports, with the industry hoping to export up to 60 lakh tonne. Last year, the export incentive had helped in exports of 57 lakh tonne of sugar.

The National Federation of Cooperative Sugar Factories (NFCSF) has said export deals for 34 lakh tonne at this juncture is a very good development and India could do better in the export market. Prakash Naiknavare, MD, NFCSF, said India is currently well placed in the international market.

“India is the only country with a ready stock of surplus sugar. Moreover, India is placed at a logistical advantage as far as exports to Indonesia, Dubai and Bangladesh is concerned vis-à-vis Brazil,” he said. “International crude prices are high due to which Brazil is likely to divert to ethanol instead of sugar, which could work in India’s favour. The International Sugar Organization’s (ISO) outlook of a 50 lakh-tonne sugar deficit is keeping prices firm.”

The ISO in its quarterly outlook has said the sugar deficit during the current season has risen to 50 lakh tonne from its earlier estimate of 35 lakh tonne three months ago. This will see production dropping this season by 1.24% to 1,690.4 lakh tonne (1,711.6 lakh tonne) while consumption is seen increasing to 1,728.2 lakh tonne (1,702.4 lakh tonne).