Sugar Industry Body Sees Better Future As Government Mulls Exports
India's efforts to bolster sugar exports and increase buffer stockpiles would help the country's makers of the sweetener perform better despite lower sugarcane availability in the upcoming season, Indian Sugar Mills Association said.
ISMA expects India's production of the commodity to fall from 33 million tonnes this year to 28-28.2 million tonnes next year, as drought conditions in parts of Maharashtra and north Karnataka would likely hurt availability of sugarcane, the association's Director General Abinash Verma told BloombergQuint in an interview. The production figure would still be slightly higher than domestic requirements, he said.
“Since sugarcane purchases would be down by almost 15-20 percent in the next season...we would mostly be selling higher quantities of sugar,” Verma said, adding he expects the next season to be better than the last two seasons for the sugar industry. Increased sales, along with export of 6-8 million tonnes of sugar and revenue generation from ethanol production should boost cash flows for millers, he said.
This would also help them make better and timely payments to sugarcane farmers, Verma said, noting that he expects the sugarcane price arrears to fall in the next three to four months.
A policy to help boost sugar exports with a view to reducing reserves should be announced this month, ISMA said.
Government Announces Measures
India has stepped up efforts to boost exports from beleaguered mills and reduce a domestic surplus.
The government on Thursday fixed an export quota of 10,000 tonne of white/raw sugar to the European Union under a provision for a 12-month period beginning October, PTI reported.
The Director General of Foreign Trade said that this quantity would be exported to the European Union, helping traders export sugar at relatively low or zero customs duty.
Watch the full interview here:
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