The government has allowed exports of one million tonne of sugar since its notification on May 24 to regulate outbound shipments to keep local supplies steady, a senior official told FE.
Sugar exports, however, will likely drop to about 7-8 million tonne in the next marketing year starting October, from 10 million tonne in 2021-22, said the official. Greater diversion of cane juice to produce ethanol, robust domestic demand and the need to replenish the somewhat depleted year-ending inventory are expected to keep a lid on the exportable surplus of sugar in 2022-23. However, the food ministry will decide whether to impose a cap on sugar exports in 2022-23 in one-two months, once a precise production estimate for the next year is firmed up, he added.
India had shipped out only 620,000 tonne of sugar in 2017-18, 3.8 million tonne in 2018-19 and 5.96 million tonne in 2019-20. Last year, against the target of 6 million tonne, about 7 million tonne of sugar was exported.
While announcing an export cap of 10 million tonne for 2021-22, the food ministry had said late last month that about 9 million tonne had been contracted for outbound shipments until then. Of this, about 8.2 million tonne was dispatched from sugar mills for exports and a record 7.8 million tonne had been physically shipped out.
Diversion towards ethanol could rise to about 4.5-5 million tonne next year, against 3.5 million tonne in 2021-22, said the official. The government has estimated that year-ending sugar stocks will likely drop to just about 6.5 million tonne in 2021-22 (which is enough for the consumption for about three months), down from 8.9 million tonne a year before, according to the source.