Sri Lanka has emerged as the largest sugar importer by contributing nearly half of India’s total sweetener exports during the current season beginning October 2018.
Data compiled by the apex industry body All India Sugar Trade Association (AISTA) shows India’s total sugar exports to Sri Lanka at 84,536.90 tonnes. With 16,801 tonnes and 15,340 tonnes, United Arab Emirates and Somalia have become the second and third largest importer of Indian sugar, respectively. Total exports between October 1 and December 5, 2018 stands at 179,849 tonnes.
“Apart from this, a quantity of 155,830 tonnes is in pipeline (waiting to load) to move in December 2018/early January 2019, out of which 113,360 tonnes are raw sugar to be dispatched to port-based sugar refineries for shipment. During this period, India exported sugar to 20 countries, of which Sri Lanka has emerged as the largest buyer,” said Praful Vithalani, Chairman, AISTA.
The government of India through a notification in September allowed 5 million tonnes of sugar exports during the current crushing season under the Minimum Indicative Export Quota (MIEQ) with an aim to reduce supply glut in the domestic market.
With a sugar production of 32.25 million tonnes against the estimated consumption of 25.5 million tonnes, total surplus for the current season is estimated at nearly 7 million tonnes. Additionally, with the carryover stocks from the last season estimated at 10 million tonnes, the supply scenario is likely to remain bleak with expectation of another bumper year of around 32 million tonnes in 2018-19.
Faced with supply glut pressurising sugar prices regularly, the Indian government has visited a number of countries to shell out some of the extra stocks.
Now, with the global sugar supply forecasted to remain in deficit this year, India has a fair chance of exports to the world market.
Meanwhile, the wholesale sugar price is currently quoted at Rs 29 a kg of ‘S’ variety and Rs 29.50 a kg of ‘M’ variety in Mumbai. Farm gate sugar prices are currently hovering between Rs 29-30 a kg across the country, which mills are compensating partly with an increase in recovery in the high yielding cane variety to compensate the high production cost of Rs 34 a kg.