November 19, 2019
The Economic Times | https://bit.ly/2DgW7AZ
Pune: Indian sugar mills have so far contracted for export of 1 million tonne sugar for export during 2019-20 sugar season that began on October 1 driven by good demand from Iran and some countries from Asia. India has set target of exporting 6 million tonne sugar to ease the situation of surplus sugar in the country.
“According to our estimate, India has contracted for export of 1 million tonne sugar starting October 1. There has been good demand from Iran,” said Mumbai-based sugar trader Praful Vithalani. The deals were signed for $310 per tonne FOB (free on board) for raw sugar and $313 per tonne FOB for white sugar. Vithlani said that the 50 per cent of the contracted exports are of raw sugar and the remaining 50 per cent are of white sugar. Indian government has extended incentives to be paid to the sugarcane growers in order to boost exports. During 2018-19, government had set a target of 5 MT of Minimum Indicative Export Quotat (MIEQ), against which the mills could export only 3.8 MT sugar. Partial fulfillment of export quota would have made the mills ineligible to avail the incentives for exports. Hence, on the request of the mills, the government has extended the last date to exhaust last year’s export quota by December 31, 2019. This is another reason for the export contracts hitting 1million tonne, even as actual production of new season's sugar is yet to gather momentum.
However, sugar millers from Maharashtra, the second largest producer of the sweetener, are not much interested in exporting sugar during 2019-20. “We have not yet signed for exports this season as the central government has not paid the export subsidy dues of previous year even to those mills, who have exhausted their export quota,” said BB Thombare, president, Western Indian Sugar Mills Association (WISMA).