Home International Sugarcane News Indian export to benefit from strong sugar prices globally

Indian export to benefit from strong sugar prices globally

by upsugartimes
Significantly, research institutes and sugar exporters have predicted that the growth of sugarcane in Brazil will be hampered by low soil moisture, which is conducive to the growth of sugarcane.

Prices of sugar in the international market have picked up on talks of declining production in Brazil, the world’s largest sugar supplier. This is likely to benefit sugar exports from India, industry people said. Global sugar prices rose by 20% in April. Brazilian production is going to almost 7-8 million tonne less than last year while Thailand produced 7-8 million tonne less than its normal production, they pointed out.

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The country’s sugar mills have so far traded close to 54 lakh tonne and physical dispatches of some 40 lakh tonne has been completed, Rahil Shaikh, vice president, All India Sugar Trade Association, said. “We expect the MAEQ of 60 lakh tonne will be successfully completed earlier than expected while the deadline is September 2021,” he said. If world market is above 19.00 cents/lb, India should be looking at exporting from OGL (open general licence) exports as it continues to be holding surplus sugar, Shaikh said.

Abhijit Ghorpade, sugar exporter from Maharashtra agreed, and said if the global market goes up due to the drought-like situation in Brazil, then India will get an opportunity to export under the OGL. Indian white sugar which was Rs 2,600 per quintal on April 1, has gone up to Rs 2,750 per quintal as on date. On April 1, Indian raw sugar was trading Rs 2,550 per quintal and has gone up to Rs 2,700 per quintal now.

The National Federation of Cooperative Sugar Factories (NFCSF) has demanded an increase in export quota in view of the situation in the international sugar market. “In view of the rise in crude prices, Brazil is expected to divert more cane towards ethanol, and therefore, forward contracts have not happened, which has resulted in higher international prices, Prakash Naiknavare, MD of NFCSF, said. “The Indian sugar season is almost at an end and the sugar is freshly produced. Thailand has also reported a decline in sugar production and this augurs well for India,” he said.

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Significantly, research institutes and sugar exporters have predicted that the growth of sugarcane in Brazil will be hampered by low soil moisture, which is conducive to the growth of sugarcane. Wilmar International said the prolonged drought could push Brazil’s sugarcane crush to 530 million tonne this season, 12% less than last year and the lowest in ten years. In addition, the beet crop in France, European Union’s largest sugar producer, has suffered a 10% loss, which will reduce sugar production there as well, said the Farmers Group CGB.

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