Government unlikely to take direct policy decision on sugar export ban: Industry experts

Kolhapur: Several media outlets have reported that the government is considering imposing a ban on sugar exports in the upcoming season. However, considering India’s strong position in the international market through sugar exports in recent years, along with the potential to capture markets of countries like Brazil and Thailand, and the impact it could have on the Indian sugar industry, experts in the sector believe that the government might not take a direct policy decision on the issue of export ban.

Speaking on sugar export, experts referred to the situation as a “sugar market challenge” and suggested that the government could make a concrete decision regarding exports by assessing the estimated sugarcane and sugar production in the country after the season begins in October and making a decisive call by December or the end of January.

The Indian Sugar Mills Association (ISMA) estimated sugar production to be around 362 lakh tons for the 2023-24 season. With around 45 lakh tons of sugar expected to be diverted towards ethanol production, the actual sugar production is anticipated to be approximately 317 lakh tons. ISMA also indicated that about 275 lakh tons of sugar would be required for domestic consumption. As per ISMA’s estimates, there could be a surplus of 42 lakh tons of sugar. However, apart from major sugarcane-producing districts in western Maharashtra and southern Karnataka, the monsoon rainfall has been below average. This shortfall in rainfall is likely to impact sugar production during the 2023-24 season. Consequently, the government has already initiated steps to address the issues of sugar and ethanol industries.

Recently, sugar prices soared in local markets, prompting the government to release an additional 2 lakh tons sugar quota for August 2023.

According to Prakash Naiknavare, MD of National Federation of Cooperative Sugar Factories Limited (NFCSF), the notification for sugar exports for the year 2022-23 is set to expire on September 30, 2023. This year, the government’s quota of 6.1 million tons for exports has already been fulfilled. Hence, the possibility of issuing a new notification for exports seems unlikely.

Speaking to ChiniMandi, he said, “Over the past few years, India has carved its own identity in the international market through sugar exports. Thus, the government will not allow it to be affected by announcing an export ban directly. After a review of sugar production in the country in January 2024, the sugar industry will attempt to obtain export permits from the government”. He has expressed hope of sugar exports from India to some extent after January 2024.

Senior expert of the sugar industry, P.G. Medhe, in conversation with ChiniMandi, has expressed that due to a shortfall in monsoon rains in the sugarcane-producing regions of the country, there is a possibility of reduced sugarcane production. Therefore, the central government will assess the domestic sugar requirement and potential sugar production and determine its export policy. It is anticipated that the government will clarify its position in October after the upcoming season begins. He also emphasized that while doing so, the government will ensure that the sugar industry is not adversely affected.


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