Kolhapur: Ongoing conflicts involving Iran and tensions linked to the United States and Israel have started affecting sugar exports from India, with new export deals slowing down despite enquiries from buyers in West Asia and Africa, industry sources said, Agrowon reported.
The Central government has allowed the export of 15 lakh metric tonnes of sugar in the current crushing season. However, exports have remained limited as international prices are lower than those in the domestic market.
Several countries including Iran, Afghanistan, Sudan, Somalia, United Arab Emirates, Sri Lanka and Bangladesh have traditionally been important markets for Indian sugar. However, the ongoing conflicts and instability in some of these regions have begun to affect export activity.
According to trade sources, some countries have made enquiries about Indian sugar, but fresh purchase agreements have largely come to a halt.
By the end of February, contracts for only around three to three-and-a-half lakh tonnes had been finalised out of the export quota, and about two lakh tonnes had actually been shipped.
Experts said the export window still remains open for about six months. However, if tensions in the Gulf region continue for a longer period, the Indian sugar industry may face indirect financial losses.
Trade sources said that in recent years nearly 30 to 35 per cent of IndiaтАЩs total sugar exports have been directed to markets in West Asia and Africa. With the ongoing conflict, exports to several of these destinations have slowed significantly.
Industry representatives said demand from these countries could rise again if the geopolitical situation stabilises.
