India's sugar export may cross 5 MT this year on higher overseas demand; govt to reallocate export quota of mills: ISMA

New Delhi: India’s sugar export may cross 5 million tonne in the marketing year ending September on higher demand from overseas amid global deficit of 8-9 million tonne, industry body ISMA said on Tuesday. For the current year, the government has allowed export of 6 million tonne of sugar under Maximum Admissible Export Quota (MAEQ) to help deal with the surplus sugar. India had exported 3.8 million tonne during 2018-19 marketing year (October-September) against the mandatory quota of 5 million tonne. [caption id=“attachment_4950481” align=“alignleft” width=“380”] Representational image. Reuters.[/caption] The country’s sugar production has reached 16.98 million tonne till February 15 of the current marketing year, which is much lower than 21.96 million tonne output till the same period a year ago, it said. According to the Indian Sugar Mills Association (ISMA), global sugar prices for raw and white sugar are 20-25 percent higher than the prices which prevailed three months ago when India started its exports against 6 million tonne under MAEQ. “Accordingly, Indian sugar exports may get accelerated in the coming months, and could achieve more than 5 million tonne of MAEQ in the whole season,” it said in a statement. As per market reports, about 1.6 million tonne of sugar has been exported from India and about 3.2 million tonne of contracts have been signed for exports, it said. As per reports available, a few sugar mills are not planning to export sugar against their allocated export quotas. A few of them have surrendered a part of their MAEQ to the government, it added. ISMA said the government has decided to withdraw and reallocate export quota of mills which were not able to undertake shipments. “About 20 percent of export quotas of mills which have not contracted for 25 percent of their MAEQ by end of January 2020, will be withdrawn and reallocated among the others who have exported most of the MAEQ and are willing to export beyond their original MAEQ,” it said. It is understood that this process of reallocation is under active consideration and would be announced shortly, it added. As per experts in the international trade, there is an estimated deficit of 8 to 9 million tonne in the 2019-20 marketing year in the global market and that Thailand’s exports are likely to be down by 3-4 million tonne due to lower production. Sharing the latest domestic sugar production details, ISMA said total sugar production has reached 16.98 million tonne till February of this marketing year, lower from 21.96 million tonne in the year-ago period. Sugar production in Maharashtra – the country’s largest sugar producing state – dropped to 4.33 million tonne till February 15 of this year as against 8.29 million tonne in the same period last year, the data showed. Whereas production in Uttar Pradesh, the country’s second largest sugar producing state, rose to 6.63 million tonne so far when compared to 6.39 million tonne a year ago. The production in Karnataka, the country’s third largest sugar producing state, declined to 3.08 million tonne as against 3.87 million tonne in the said period. Sugar production in Gujarat stood at 5,95,000 tonne, Bihar at 5,08,00 tonne, Punjab at 3,72,000 tonne, Haryana at 3,51,000 tonne, Uttarakhand at 2,41,000 tonne, Madhya Pradesh at 3,51,000 tonne and Andhra Pradesh and Telangana at 3,06,000 tonne till February 15 of this year, the data showed. The industry body has pegged sugar production lower at 26 million tonne this year from 33.16 million tonne in 2018-19.