ThE country is expected to export a record 4.2 million tonnes of sugar in the crop year to September, exceeding earlier estimates of 3.5 million tonnes, a top trade official said on Wednesday.
With the surge in exports, which have never topped 2 million tonnes in a year, India would sell more sugar abroad than Australia, Shanti Lal Jain, director general of the Indian Sugar Mills Association (ISMA), said, adding "With India's emergence, the whole sugar exporting community feels threatened," he said.
ISMA, the apex body of leading private sugar mills, had earlier estimated that exports in the current crop year would double to about 3.5 million tonnes.
Analysts said overseas sales accelerated in the past two to three months, the peak of the sugarcane crushing season, and were now tapering off. Out of the projected exports of 4.2 million tonnes, 3.6 million tonnes have already been exported, Mr Jain said, adding that raws accounted for 2.3 million tonnes. He said India's efforts to tap raw sugar export markets had helped overall sales surge.
"The secret of our success is that we are giving the best quality of raw sugar and making the best out of our strategic location, which gives us freight advantage," he said.
India, the world's second-biggest sugar producer, entered the raw sugar export market in 2007 by selling to Dubai's Al Khaleej, the world's largest refinery, which has now switched to India from top producer Brazil.
A ban on overseas sales from July 2006 to January last year capped exports at 1.7 million tonnes in the previous crop year. Record output of 28.4 million tonnes added to the woes of mills and prices crashed. Swamped with massive stocks, mills suffered losses and the government stepped in with a slew of incentives, including a freight subsidy to boost exports.
Freight incentives evoked sharp criticism from Brazil, Thailand and Australia, which accused the South Asian nation of becoming the international rogue of the sugar trade. "Our rising exports are looked at negatively. What we got was WTO-consistent subsidy and we are very transparent about it," Mr Jain said.
He said the country's sugar output was expected at 26.5 million tonnes in this crop year to September. Production was expected to drop to 21-22 million tonnes next crop year, he said, echoing trade views that India might have to import sugar in 2009-10.
TASTE OF INDIA
Plans afoot to export record 4.2 mt of the sweetener
Mills sell 2.3 mt raws so far this year
Sugar output seen at 21-22 mt in 2008-09
India may need to import sugar in 2009-10
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