India can export 0.5-1mt sugar: govt officials.

NEW DELHI: This year’s good rains mean India can easily export up to 1 million tonnes of sugar, two government officials said on Tuesday, broadly in line with market expectations from the world’s second-biggest producer.

“We can easily export 500,000 tonnes to 1 million tonnes even if production is 24.5 million tonnes,” one government official, who did not wish to be identified, told reporters, referring to unrestricted exports.

A second official, also present, confirmed the figures.

In late November, a senior government official had said India was likely to free up sugar exports if production exceeded 24.5 million.. The India Sugar Mills Association has forecast the crop will total 25.5 million.

A more normal monsoon in 2010 allowed the country to recover from last year’s drought, which forced it to import large quantities, triggering sharp gains in international prices.

The market is waiting for New Delhi to allow unrestricted exports, termed as open general licence (OGL), which could see global prices easing.

India, which is also the world’s top consumer of the sweetener, has already allowed some restricted exports this year.

The figures cited by the officials were broadly in line with market expectations, said Jake Wetherall, a soft commodities trader with Rabobank in London.

“If it were 2 million tonnes (of OGL exports) that would be bearish,” Wetherall said.

On Tuesday, ICE March raw sugar futures were up 1.24 percent to 29.37 cents a lb at 1204 GMT, off a high of 29.56 cents. Sugar was firmer due to a soft dollar and as adverse weather in key producers such as Australia and Brazil helped to underpin the market.

Last month, Farm Minister Sharad Pawar said India was likely to take a decision on allowing unrestricted sugar exports by the third week of December and the country might ship exports on a monthly basis.

India’s sugar market is regulated by the government with the objective of keeping prices and supply steady as it is an essential commodity that goes into everyday use and is also politically sensitive.

Source : dailytimes.com.pk