Record exports for sugar mills in Maharashtra

Sugar mills in Maharashtra, the nation's second-biggest cane-grower, have contracted to export 1.03 million metric tonnes since January to run down stockpiles after production reached a record.

The quantity is two-thirds the tonnage mills across India have committed to ship by December, said Prakash Naiknavare, managing director of the Maharashtra State Co-operative Sugar Factories Federation, a grouping of cane farmers.

Indian mills are under pressure to export as record sugar cane output has caused domestic prices to fall by more than a quarter in the past six months. An increase in shipments from India may add to a global surplus estimated by ED&F Man Holdings to reach 9.8 million tonnes this year.

Producers signed contracts to sell 100,000 tonnes in the past week at $257 a tonne, Naiknavare said. The price excludes freight charges to the port. "Export sales have exceeded our expectation," he said. "There is still good demand for our sugar."

Sugar output in Maharashtra reached a record 9.2 million metric tonnes between October 1 and June 19, up 77 per cent from a year ago, according to the National Federation of Cooperative Sugar Factories. That prompted the state government to offer mills an export subsidy of Rs 2,350 a tonne to help lower inventories.