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MUMBAI, June 8 (Reuters) – India could produce a record 36 million tonnes of sugar in 2021/22, almost 3% more than expected, as output rose more than expected in the state western Maharashtra and neighboring Karnataka, a trade association said. Wednesday.
Record output from the world’s largest sugar producer could weigh on world prices, but would help the South Asian country maintain large carryover stocks for domestic use, even if it exports the allowed 10 million tonnes by the government, which would also be a record for exports.
India produced 35.24 million tonnes of sugar in the first eight months of the 2021/22 marketing year, which ends September 30, and 29 mills are still operational, the Indian Sugar Mills Association said. (ISMA) in a press release.
The factories have signed contracts to export around 9.5 million tonnes of sugar in 2021/22. Of this total, 8.6 million tonnes had been physically moved by the end of May, the association said.
India last month imposed restrictions on sugar exports for the first time in six years by capping this season’s exports at 10 million tonnes to prevent a spike in domestic prices after factories sold off a volume world market record. Read more
Aditya Jhunjhunwala, president of ISMA, said that given the larger harvest expected, more exports should be allowed this season.
“Considering the increase in sugar production estimated above, the government should allow the industry to export another 1 million tons,” Jhunjhunwala said.
“This will leave sufficient opening balance of sugar stocks for 2.5 months of sugar consumption,” he said.
India could start the new season on Oct. 1 with 6.7 million tonnes of carryover stocks, up from 8.2 million tonnes a year earlier, ISMA said.
The association had revised upwards the estimate of production and exports in April. Read more
Reporting by Rajendra Jadhav
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