India's sugar exports accelerate on global price rally, weak rupee

‘Export contracts for 550,000 tonnes signed in recent days’

Indian sugar mills signed contracts to export 550,000 tonnes of the sweetener in recent days, as surging global prices and a weak rupee made overseas sales lucrative, four dealers told Reuters.

Higher exports from the world's second-biggest sugar producer could check the rally in global prices , which have been buoyed by a spike in crude oil prices and lower output in top exporter Brazil.

The shipments will also help India reduce its stockpile and support the local prices of the sweetener, crucial in ensuring millions of cane farmers get government-mandated prices.

"In the past few days, mills from Maharashtra and Karnataka were active in the market. They were getting better realisation from exports than local sales," said Rahil Shaikh, managing director of MEIR Commodities India.

Indian mills have so far signed contracts to export 6.4 million tonnes of sugar in 2021-22, dealers estimated. Out of this, close to 5 million tonnes have already been shipped.

In the last few days, Indian traders mainly sold raw sugar to Asian buyers such as Indonesia and Bangladesh, which were trying to replenish their inventories ahead of the Muslim holy month of Ramadan, said a Mumbai-based trader with a global trading firm.

India had exported a record 7.2 million tonnes of sugar in the previous season, taking advantage of government subsidy for overseas sales.