Reuters news agency has reported that it could potentially limit exports to 10 million tonnes this season. India is the world’s largest sugar producer and the second largest exporter behind Brazil.
Following the news, Dalal Street sugar stocks took a tumble, with most falling over 5%.
“The government wants to monitor exports so they don’t exceed the magic number of 10 million tons. As for 10 million tons, we have very serious doubts as to whether or not 10 million tons will actually be reached,” Atul Chaturvedi, Shree Renuka Sugars told ET Now. “First, only about 7.2 million tons of sugar has been exported to date, and once the rainy season in exports begins, exports will definitely fall, and 10 million tons is still a long way off,” he said.
After Russia’s invasion of Ukraine, food prices have skyrocketed and governments around the world have taken steps to protect the domestic prices of certain commodities.
Malaysia will stop exporting 3.6 million chickens a month from June 1, Indonesia recently temporarily banned palm oil exports, India restricted wheat exports, and Serbia and Kazakhstan imposed quotas on grain shipments.
Heatwaves have withered fields in India, prompting a May 13 government order to limit supplies and secure domestic supplies. India makes exceptions to export restrictions only for prior commitments by private traders through irrevocable letters of credit and for exports to countries that require wheat for food security based on their governments’ requests.
Indonesia also halted palm oil exports on April 28, only to reverse them earlier this week.
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