Govt unlikely to allow sugar exports next season
2 min read 02 Jun 2023, 10:48 PM ISTThe government is also trying to improve its crop assessment process as last season sugar production was higher than estimated by the sugarcane commissioner and this year it was lower than estimated
PremiumThe department of food and public distribution is unlikely to allocate quota to sugar mills for export or allow Indian mills to export sugar in 2023-24 (October-September) to ensure domestic supply and keep prices in check. This comes in the backdrop of India’s sugar production in the ongoing season dipping to 32.4 million tonnes (mt) from the initial estimates of 36.5 mt, in turn driving the government’s decision of retaining export restrictions on the sweetener.
“People who are expecting that the government will announce sugar export quota with the beginning of the new season from October, they should drop the thought," said a senior government official. “There will be no deliberations on sugar exports until we receive the advance estimates of sugar production or initial cane assessment for the next season."
The government comes up with its first advance estimates of foodgrains production and output of commercial crops including cotton and sugarcane in September. The government is also trying to improve its crop assessment process as last season sugar production was higher than estimated by the sugarcane commissioner and this year it was lower than estimated.
Indian sugar mills have exported 5.9 mt sugar, and shipped 6.08 mt, almost the entire quota of 6.1 mt, the official informed. Production in the current season dropped due to early closure of mills in leading producer Maharashtra and Karnataka amid lower yield and sugar recovery.
The US Department of Agriculture (USDA) recently came up with world sugar production estimates for the next season, where it said that India’s sugar production in 2023-24 (October-September) is estimated to be 4 mt higher than the current season at 36 mt because of higher area under sugarcane and yields. However, it would depend on how El Nino affects Asia, the USDA said.
Indian Sugar Mills Association, a body of private mills, will likely come up with its projections on 2023-24 sugar production in July.
In its latest report, the USDA said global sugar output is projected to be 10.6 mt higher at 187.9 mt with increased production in Brazil and India more than off setting a decline in Russia.
“We are in comfortable position as far as India’s domestic consumption is concerned. With about 15 mills working in south Karnataka and Tamil Nadu in the special season during July-September, we will have around 300,000-500,000 tonnes of additional sugar," the official said. “With this, India is expected to produce about 32.7-32.8 tonnes sugar in the ongoing season. However, no additional export quota will be allocated to Indian sugar mills."
Additionally, the department is focusing on achieving 20% ethanol blending in petrol (E20) by 2030, wherein as part of the plan, it will divert 5 mt sugar to ethanol production next season.
“We are on track to meeting the E20 target. Meeting it through maize (corn) may be challenging immediately but we have Food Corp. Of India (FCI)’s broken rice and sugar is already there. Our capacity is more than 1,150 crore litres. There is no issue on the supply side," the official added. “The figure of 32.4 mt of sugar production excludes 4.5 mt of ethanol production this season. Next season ethanol blending from sugar and B molasses will cross 5 mt and 5.5 mt in 2024-25."
Queries to the Department of Food and Public Distribution on Thursday remained unanswered till press time.
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