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India’s Sugar Industry Gets a Sweet Boost, Govt. Approves 1 M Tons of Exports Amid Domestic Challenges The export approval marks a significant policy shift after the government banned sugar exports during the 2023-24 marketing season.

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NEW DELHI: In a major development, India is set to allow the export of 1 million metric tons of sugar during the ongoing season, according to government and industry sources. The move is intended to help sugar mills offload surplus stock while stabilizing domestic prices, even as the country faces its first production shortfall in eight years.

The government is expected to issue an official notification soon, sources confirmed. This limited export approval could add downward pressure on global sugar prices, which have already softened in recent months.

“We are taking a calibrated approach to ensure domestic supply is protected while giving sugar mills the opportunity to manage their inventory,” a senior government official said.

This year’s sugar production is estimated to decline to 27 million tons, down from 32 million tons last year and below the domestic consumption requirement of over 29 million tons, according to leading trade houses. The decline is attributed to lower cane yields in Maharashtra, Karnataka, and Uttar Pradesh—states that account for over 80% of India’s total sugar production.

A Balancing Act Between Exports and Domestic Needs

The export approval marks a significant policy shift after the government banned sugar exports during the 2023-24 marketing season. This year’s decision comes with tight controls, as sources hinted that additional export volumes may not be permitted if production estimates fall further.

“India has historically been a major player in global sugar markets. The government’s decision to allow only 1 million tons of exports reflects a cautious yet strategic approach to safeguard domestic supply,” said Rajesh Gupta, a commodity analyst.

India was the world’s second-largest sugar exporter between 2017-18 and 2022-23, averaging 6.8 million tons annually. Key export destinations include Indonesia, Bangladesh, and the United Arab Emirates. However, the export ban imposed last year disrupted this momentum.

Relief for Struggling Mills

The Indian Sugar and Bio-energy Manufacturers Association (ISBMA) lauded the government’s decision, emphasizing that it would provide relief to mills grappling with low domestic prices, which are currently at their lowest in 18 months.

“This limited export approval is a lifeline for the sugar industry,” said Deepak Ballani, Director General of ISBMA. “With domestic prices under pressure and production costs rising, even a small export quota can help stabilize the industry.”

Industry Outlook

The government’s approval comes amid optimism for the next production cycle. Early projections suggest that the 2025-26 season could witness a rebound in production, possibly exceeding 30 million tons.

“Given next year’s strong production outlook, this export allowance not only helps clear surplus stocks but also positions India to return as a key global exporter,” Ballani added.

Experts believe the approval reflects a carefully crafted policy that balances domestic supply concerns with the economic pressures faced by mills. “This is a win-win situation. The 1 million tons will ease inventory pressure, support local prices, and help maintain India’s presence in the global sugar market,” said Gupta.

As the industry watches for further policy updates, all eyes are on the government’s monitoring mechanisms to ensure exports do not disrupt domestic supply..

-Dr. Shahid Siddiqui, follow @shahidsiddiqui on X

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