New Delhi: The Indian government on Wednesday extended export curbs on sugar beyond 31 October, to ensure adequate domestic supplies amid higher demand and output concerns in major producing states following the weakest monsoon season in five years.
The date of ‘restriction’ on export of raw, white, refined and organic sugar is being extended beyond 31 October 2023 till further orders, the Directorate General of Foreign Trade said in a notification. Other conditions remain unchanged.
The curbs, however, do not apply to sugar exported to the European Union and the US under the CXL and tariff-rate quota systems, the DGFT notification clarified.
On 2 June, Mint had reported that government may not allow mills a free hand in exporting sugar in the 2023-24 (October-September) season.
India, which surpassed Brazil in the 2021-22 season to become the world’s largest sugar producer and second-largest exporter, imposed export controls in October last year, adopting a mill-wise quota system. By the end of the 2022-23 crop year (July-June), local sugar mills had exported 6.2 million tonne of the sweetener.
This year with production numbers under the cloud following erratic monsoon rains, and inflation a major concern with several states heading for polls in the coming month ahead of the Lok Sabha election in 2024, the government aims to keep prices of the kitchen essential under check.
On Tuesday, all-India average retail sugar price was ₹44.03 a kg, up nearly 2% month-on-month, 3.1% on year, according to data from the consumer affairs ministry.
“Sugar output is expected to fall to 30 million tonne (mt) in the 2023-24 sugar season against domestic consumption of 27.5-28 mt due to El Nino compromising monsoon rain in August,” a government official had told Mint earlier. “However, El Niño is anticipated to strengthen through 2023-24, which could lead to intensification of dry conditions during the next sugar season. This may lead to a further decline in sugar production during the 2024-25 season.”
The government’s priority is to ensure adequate supply for domestic consumption, ethanol production, keep domestic sugar prices in check, and have optimal closing stock at the end of the season.
India aims to produce 4.5 million tonne of ethanol from sugar this season, which would necessitate higher cane diversion and thus lower closing stocks of the sweetener. A slightly higher closing stock will help contain domestic retail prices and can be used as a buffer for the 2024-25 season, the official added.
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Updated: 18 Oct 2023, 02:12 PM IST