India to export more sugar to meet demand
India to export more sugar to meet demand
NEW DELHI (Reuters): India, saddled with huge stocks, hopes to export more than one million tons of sugar by September this year helped by new demand from Indonesia and Pakistan and better prices, industry officials said on Friday.
"We expect that one million tons of sugar will be shipped out of the country by the end of September and contracts for deliveries in 2001 and early next year could cross 1.5 million tons," an exporter said in Ahmedabad.
He said Indian sugar becomes attractive for exports when international prices rise above $250-$255 a ton.
March white sugar on the London futures market was quoted at $246.5 a ton on Friday.
Traders said this week Indian mills had sold around 84,000 tons of sugar to international trading houses between $253-257 a ton FOB.
Managing director of the National Federation of Cooperative Sugar Factories Vinay Kumar said new markets are emerging in Indonesia and the Philippines, and Pakistan needs plenty too.
The industry planned to send a delegation to Indonesia, which needed about 300,000-400,000 tons of sugar, he said.
With the recent deals, India's sugar exports have reached 350,000 tons since last August when it began exports to cut a 10- million ton stockpile.
The Indian Sugar and General Industry Export Import Corp Ltd, a private body that exports sugar on behalf of the industry, sold 14 cargoes of 12,500 tons each in August last year.
But there has not been much activity since then due to a fall in global sugar prices.
"Overall exports should be bright...most of the Thai and Brazilian sugar has been priced. It is only the Indian sugar that is left in the market," said Yatin Wadhwana, a leading sugar trader.
He said Pakistan had already bought 600,000 tons of sugar from various parties since last April and needed another 700,000 to 800,000 tons by October.
India had sold around 200,000 tons to Pakistan since September, of which 150,000 tons had been physically moved out. India moves sugar to Pakistan mainly by railway rakes through the northwestern state of Punjab.
Kumar said a shortage of rakes was leading to congestion at the border and the sugar federation had written to the railways to facilitate faster movement.
Earlier this month, India announced it was cutting to 15 percent from 30 percent the quota of output mills supply to the government at cheaper rates effective from April 1. T he reduction in the quota is a measure to gradually ease state controls on sugar supplies in line with recommendations of an expert panel in 1998.
Media reports said Food Minister Shanta Kumar had agreed to implement the new decision from February 1 instead of April because the bulk of the cane crushing for the current 2000/01 (Oct-Sept) season would be completed by then.
Analysts said the recent government measures would bring down India's domestic prices and boost sugar exports.