According to sources, in a ministerial committee meeting taken place today 27th July 2022 it is believed that a quantity of 12 LMT of additional sugar export quota has been sanctioned after considering factors like raw sugar is lying idle at the mills or ports and proving to be unhelpful in building of the closing stock, mills have no option to convert raw sugar to white sugar or sell it in the domestic market leaving export the only option.
Further, because of unexported quantities mills would not only have to face financial losses but also end up in litigation for non-fulfillment of exports contracts and losses to forex hedging.
The source also informed that sugar consumption which was estimated to be 278 LMT has been revised to 273 LMT for sugar season 2021/22; thus lower consumption. Therefore, there is no reason to believe that more exports of sugar would affect the domestic market, instead the closing balance would be at comfortable levels around 60 LMT that would meet the needs of the country. It is important that Indian millers gets further opportunity to export the surplus sugar looking into the scenario that next crop might be bigger and crushing in Maharashtra is likely to start from 1st October 2022 onwards.