There are indications that India’s sugar exports will decline, with sources in the know putting the figure to a 28.57% decline, representing 8 million tonnes for the 2022-2023 season. This is coming on the back of higher diversion of ethanol and lower opening balance stock.
There are now discussions among relevant authorities on how to salvage the situation. As part of the solution presented, officials are debating whether to permit exports under an open general license or leave it under the prevailing quota system.
Sources added that the government would decide after the sugarcane crushing operation kicks off the upcoming season. While India’s sugarcane season starts from September to October, the crushing season kicks off from October to November and may sometimes last to mid-April.
The country’s sugar export is estimated at around 11.2 million tonnes for the current season.
Although officials are optimistic that sugar output will increase, they expect exports for next season to decline.
With authorities foreseeing a decline in sugar exports, analysts expect the sugar supply to lower with a starting balance of 6 million tonnes in the coming season. Authorities are also predicting that there would be a higher diversion of ethanol.
In previous years, India has enjoyed an opening balance of sugarcane between 9 to 10 million tonnes. The last couple of years has been particularly great for sugarcane production in India, especially with an increased downpour in states like Karnataka and Maharashtra. Also, irrigation in Uttar has increased sugarcane production in the region. But as things stand, things may dwindle for the 2022-23 season as the opening balance is expected to come in at around 6 million tonnes.
As per the diversion of cane ethanol, sources expect it to be significantly higher for 2022-23 than in previous seasons. And that’s because authorities are scheduled to divert nearly 4.5 to 5 million tonnes of sugar for ethanol next season. This sharply differs from the 3.5 million tonnes allocated for other seasons.
A look at inputs from key production states show that the country’s sugar production will come in at over 40 million tonnes for the 2022-23 seasons. This is slightly above the 39.5 million tonnes generated in previous seasons. That said, though the overall sugar output is looking good, exports are expected to be lower next season.