The Indian government is expected to announce a ban on sugar exports for the upcoming season in order to reserve an adequate supply for domestic use, said the Thai director-general of the Foreign Trade Department.
Currently, global sugar prices are determined by three major exporting giants: Brazil, Thailand, and India. If India proceeds with the measure, it is expected to have a definite impact on global sugar prices.
The director-general, Ronnarong Phoolpipat disclosed that India’s ban on rice exports on July 20 has already created turmoil in the global rice market. The Indian government is now preparing to announce a ban on sugar exports for the upcoming season, starting in October.
India is one of the world’s largest sugar producers, and with a population of approximately 1.4 billion, it consumes the most sugar domestically.
The country has been grappling with a drought crisis due to exceptionally hot weather conditions in the first half of the year, coupled with a deficit of rainfall during the monsoon season. This has affected the sugarcane crops in the primary sugarcane-growing regions of the western state of Maharashtra and the southern state of Karnataka, which together account for more than half of India’s total sugar production.
With rainfall levels dipping as much as 50% below the average in these areas, India’s sugar production for the 2023/24 season could fall by 3.3% to 31.7 million tons. This could potentially have consequences for the upcoming 2024/25 production season.
The decision by India to prohibit sugar exports is likely to have significant repercussions on the global sugar market, he said. This move is expected to result in a reduction in worldwide sugar consumption and an increase in sugar prices. Additionally, products that contain sugar as a key ingredient are anticipated to experience price hikes. (TNA)
