India is expected to ban mills from exporting sugar in the next season beginning October, halting shipments for the first time in seven years, as a lack of rain has cut cane yields, three government sources stated.
India's exclusion from the global market would probably push up benchmark prices in New York and London, which are currently trading at multi-year highs, raising concerns about future food market inflation.
According to a government source who asked not to be identified in accordance with official guidelines, "our main focus is to satisfy local sugar requirements and produce ethanol from surplus sugarcane." We won't have enough sugar to meet export quotas for the forthcoming season.
After allowing mills to sell a record 11.1 million tonnes of sugar previous season, India only permitted them to export 6.1 million tonnes of sugar during the current season through September 30 based on import export data. To reduce sales abroad, India added a 20% tariff to sugar exports in 2016.
According to weather department data, monsoon rains have been up to 50% below average so far this year in the key cane growing regions of the western state of Maharashtra and the southern state of Karnataka, which together produce more than half of all the sugar produced in India.
An industry executive who wished to remain anonymous warned that patchy rainfall would lower sugar production in the 2023–2024 season and even decrease planting for the 2024–2025 season.
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