India May Ship 2 Million Tons of Sugar, Saraogi Says.

India, the world’s second-biggest sugar producer after Brazil, may allow 1.5 million to 2 million metric tons of exports this year, said Vivek Saraogi, president of the Indian Sugar Mills Association.

The country is forecast to produce 25.5 million tons in the 2010-11 season, Saraogi said today at an International Sugar Organization conference in London. Opening stocks were 5.2 million tons, he said, resulting in a total availability of 30.7 million tons. India may also have a surplus in the 2011-12 season, said Saraogi, who is managing director of Balrampur Chini Mills Ltd., the country’s second-biggest miller.

Concerns about the size of Indian exports contributed to a 4.7 percent rise in the price of white, or refined sugar, in the past two weeks. Raw sugar climbed 3.3 percent over the same period. The government will decide on easing export curbs in the third week of December, Farm Minister Sharad Pawar said today. India may allow shipments in monthly tranches and overall exports will depend on production, he told reporters in New Delhi.

India, which is also the world’s largest consumer, will have “adequate” sugar for local use in the year started Oct. 1, with output seen at 24.5 million tons and domestic use at 22.5 million to 23 million tons, Junior Farm Minister K.V. Thomas wrote to legislators today. Stockpiles from the previous season were 5.1 million tons, he said, after two years in which supply trailed demand.

White sugar for March delivery declined $29.80, or 4.1 percent, to $698 a ton on NYSE Liffe at 1:39 p.m. London-time, reversing gains of as much as 0.9 percent. Prices have climbed 49 percent in the past six months. The price touched $811 a ton on Nov. 11, the highest level since at least 1989.

Raw sugar for March delivery dropped 1.18 cents, or 4.2 percent, to 27.17 cents a pound at on ICE Futures U.S. in New York, after earlier today rising as much as 1.7 percent. The sweetener reached 33.39 cents a pound on Nov. 11, the highest level since January 1981.

Source : businessweek.com