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India manages to export 1.26 million tonnes sugar so far amid global glut

Sunday, 9 August,New Delhi : India, which is saddled with surplus sugar stocks, managed to export 1.26 million tonnes of the sweetener in seven months to April 2015 at a time when the world market is facing a glut situation.

Sugar output has exceeded the domestic demand in the world’s second largest sugar producer for the last five years and the trend is expected to continue in the current sugar marketing year (October-September) too.

India exported 1.26 million tonnes of sugar during October 2014 – April 2015 period of the ongoing marketing year, according to the official data.

Sudan accounted for the highest sugar exports of 3,78,132 tonnes during the period under review, followed by Somalia (1,62,873 tonnes), Sri Lanka (1,54,020 tonnes), UAE (1,05,540 tonnes), and Tanzania (91,138 tonnes) in that order.

Although exports are not viable now due to sharp decline in global prices, the government is trying all options including barter trade to push export of 4 million tonnes of surplus sugar to help cash-starved domestic mills make payment of dues over Rs 14,000 crore to cane farmers.

The sugar industry, which owes about Rs 14,398 crore to cane farmers, is unable to make payment as it is facing severe liquidity crunch on account of surplus production that has resulted in low prices of sugar in domestic markets.

Ex-mill sugar prices have fallen below Rs 20/kg in the country, while the cost of production is over Rs 30/kg.

The country is estimated to produce 28 million tonnes of sugar in 2014-15 marketing year, against annual demand of 24.8 million tonnes. There is still surplus stock of 10 million tonnes in the country.

Meanwhile, world sugar production this year is estimated to exceed demand by 6,20,000 tonnes.