Larger exports from the world's second-largest sugar producer might stress benchmark New York and London futures, that are hovering close to five-year lows.
India was the world's second-largest sugar exporter within the 5 years to 2022/23, with shipments averaging 6.8 million tons yearly. However a drought prompted the federal government to ban sugar exports in 2023/24, permitting just one million tons final yr.
“In case you are speaking about doubtless export volumes for this season, we're taking a look at as much as 2 million tons of sugar going in another country,” Deepak Ballani, director normal of the Indian Sugar & Bio-Vitality Producers Affiliation (ISMA), informed Reuters.
India's internet sugar output for the 2025/26 season, which started on Oct. 1, is estimated at 30.95 million tons after diverting about 3.4 million tons for ethanol manufacturing, up 18.5% from final yr, in response to ISMA.
The business physique had earlier anticipated a diversion of 4.5-5 million tons of sugar for ethanol this yr, however solely 28% of the overall allocation for the biofuel went to sugar-based ethanol, with the rest allotted to feed-based ethanol vegetation.
INDUSTRY SEEKS TO START EXPORTS BEFORE BRAZIL'S NEW SEASON
The business has urged the federal government to permit mills to start sugar exports early to allow them to produce uncooked sugar initially of the season for abroad shipments, stated Prakash Naiknavare, managing director of the Nationwide Federation of Cooperative Sugar Factories (NFCSF). India may have a brief window of practically three months to export earlier than Brazilian provides from the brand new season begin and weigh on international costs.
Home sugar costs are at the moment increased than international charges, however Indian mills anticipate export parity by early December as new-season provides start to stress native markets, stated Ballani.
“Sugar mills will incur losses because of massive unutilised capability for ethanol as many mills expanded capability following the federal government's push for 20% ethanol mixing in petrol, they usually should produce extra sugar,” Ballani stated.
