India’s sugar industry is witnessing a significant shift in its export landscape, with opportunities arising from favorable domestic conditions. Here are the latest developments:

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Export Capacity

India’s sugar mills are gearing up to export up to 2 million metric tons of sugar this season. This comes after a challenging phase marked by export restrictions due to weather-induced production declines.

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Improved Domestic Supply

An improved domestic supply scenario, coupled with a drop in local sugar prices, has set the stage for exports. Mills are optimistic about leveraging these conditions to enter global markets.

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Record Production Forecast

The 2024-25 season promises to be robust, with sugar production expected to reach record levels. This growth is attributed to:

• Increased cultivation of sugarcane, supported by favorable water availability.
• Farmers shifting from less lucrative crops to sugarcane due to lower competition in pricing.

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Government Policy Push

The Indian Sugar Mills Association (ISMA) has urged the government to permit exports of at least 1-2 million tons. With improved supply dynamics, this policy could help reduce the domestic surplus and support mill profitability.

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Price Challenges

Despite positive production trends, sugar prices in India have hit a 1.5-year low, posing challenges for mills. Falling prices impact their ability to maintain profitability and settle dues with farmers, further intensifying the need for export markets.

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Surplus Situation

Even with a government nod for exporting 2 million tons, a surplus of 5.6 million tons is projected at the start of the next season in October 2025. This underscores the need for strategic measures to balance supply and demand.

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Learning from the Past

India’s sugar export trajectory has seen disruptions, notably the 2022-23 export ban triggered by drought conditions. The current scenario offers a chance to rebuild global trade ties while addressing domestic economic pressures.

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Conclusion

India’s sugar industry is at a critical juncture, balancing record production with pricing challenges and surplus management. Strategic exports, aligned with government policies, could help stabilize the market and boost the sector’s global standing.

Stay tuned for more updates on this evolving story.