London: The raw sugar price could explode to 50 cents a lb if India does not retain substantial stocks, Jamal al-Ghurair, chairman of Dubai’s Al Khaleej sugar refinery, said on Monday.
“If we didn’t have the Indian buffer stock, prices could go to 50 cents a lb,” Al-Ghurair told a sugar conference. The Dubai Al Khaleej sugar refinery is the largest in the world.
ICE March raw sugar futures were up 0.01 cents to 12.36 cents a lb on Monday.
Al Ghurair said India needed stocks equivalent to at least two-thirds of its annual consumption, or around 14 million tonnes, to prevent disruption to sugar markets.
“It’s dangerous (dependence on Indian stocks). It’s important to have stocks,” he said.
Current total Indian stocks stand at around 11 million tonnes, Vinay Kumar, managing director of India’s National Federation of Co-operative Sugar Factories Ltd, told Reuters on the sidelines of the conference.
Al Khaleej Sugar is a major sponsor of the Dubai 3 - 5 February 2008 sugar conference, attended by some 400 leading sugar industry traders, merchants and analysts from around the world.