Sugar export pace normal

15-Mar-2025 12:48 PM

Sugar Export Pace and Market Dynamics in 2024-25

India's sugar export pace remains steady despite challenges in pricing and global competition. Here are the key insights:

Current Export Status

• Contracts Signed: About 6 lakh tonnes of sugar have been contracted for export in 2024-25.
• Dispatched: Around 2.50 lakh tonnes have already been shipped.
• Export Target: The government has permitted 10 lakh tonnes for export, expected to be completed by September 30, 2025.

Challenges in Export

• High Domestic Prices: Indian millers are reluctant to sign new contracts as domestic prices remain high and stable.
• Soft International Prices:
  • Global sugar prices have fallen to a three-year low.
  • Indian sugar (low quality) is priced at par with Brazil's good quality sugar, reducing demand.
  • Indian white sugar is $20 per tonne costlier than London Exchange futures prices.
• Global Competition:
  • Brazil dominates the global sugar market with competitive pricing.
  • The new sugarcane crushing season in Brazil starts next month, increasing global supply.

Export Destinations & Demand

• Major Importers of Indian Sugar: Afghanistan, Bangladesh, Indonesia, Sri Lanka, UAE.
• Weak Interest from Importers: Due to lower global prices and cheaper Brazilian sugar.

Domestic Market Concerns

• Production Decline: India’s sugar output in 2024-25 is estimated to be 50 lakh tonnes lower than 2023-24, potentially affecting domestic supply and pricing balance.

Conclusion

While the export process is ongoing, pricing pressure and global competition from Brazil pose challenges. The industry is cautiously monitoring domestic supply-demand dynamics as lower production could impact future pricing and trade strategies.