Sugar exports more than double to 43 lakh tonnes

India’s sugar exports have reached about 43 lakh tonnes till first week of August in the current 2007-08 season, which is more than double from the entire shipments last season.

“Sugar exports have reached 43 lakh tonnes in this season, of which white sugar contributed 18 lakh tonnes and raw sugar over 24 lakh tonnes,” an industry official said.

The sugar exports by the end of this season, which runs from October to September, may cross 45 lakh tonnes as shipments have slowed down with the surge in domestic prices, he added.

Unlike most other countries, India produces white sugar generally, which has a limited export market.

However, for the first time in the history of sugar industry, raw sugar exports is being undertaken in sizable quantities this season.

Indian raw sugar is competitive in the West Asian markets such as UAE, Saudi Arabia, Iran, Egypt, Malaysia, Indonesia, Bangladesh and China. Some quantities are also exported to African countries.

The industry estimates that sugar exports could decline significantly in the next season as production is projected to decline and the central assistance offered to the exporters is also in all probability coming to an end in September.

Indian Sugar Mills Association Director General S L Jain had said exports could drop to around 15 lakh tonnes in 2008-09 season starting from October.

“The domestic prices have gone up while the global market has softened. The price-parity should be there for making exports,” he had said.

According to industry, the sugar production is seen at 200 lakh tonnes in 2008-09 season, while the government has pegged the output at 220 lakh tonnes.

The projections are much below this year’s output pegged at 265 lakh tonnes.

The annual demand of India, the world’s second largest producer and biggest consumer, is 210 lakh tonnes. The available supply of sugar next year is expected to be 330 lakh tonnes including 110 lakh tonnes of carryover stocks.

Union Agriculture Minister Sharad Pawar had announced in June that the government would withdraw the export subsidy after the end of this season in September.

In order to help the sugar industry liquidate surplus sugar in the overseas markets, the Centre is offering an assistance of Rs 1,350 per tonne for the mills located in the coastal districts, while Rs 1,450 per tonne for those situated in non-coastal areas.