Sugar Mills Urge Government to Ease Export Restrictions

India's sugar industry continues to urge the government to allow limited sugar exports. While the recent approval for ethanol production from sugarcane juice and B-heavy jaggery for the 2024-25 supply year has been welcomed, mills are looking for more support. Industry leaders believe exporting 1 million to 2 million tonnes of sugar will help maintain financial stability and ensure that farmers receive timely payments for their sugarcane.

Tarun Sahni, vice-president of Triveni Engineering and Industries Ltd, highlighted the necessity of revisiting current export restrictions. These were implemented to secure domestic sugar supplies but should be reviewed as stock levels and market conditions evolve. Allowing small quantities of exports could significantly improve the liquidity of sugar mills.

Rising Costs Squeeze India’s Sugar Producers

The sugar industry is facing immense pressure due to rising production costs. The Fair and Remunerative Price (FRP) has increased to USD 4,08 per tonne, yet the minimum selling price (MSP) for sugar has remained stagnant at USD 0,38 per kg since 2019. This mismatch has left mills struggling with profitability, making it difficult to keep up with payments to sugarcane farmers.

With input costs rising and the demand for sugar steadily increasing, industry leaders are calling on the government to raise the MSP to at least USD 0,51 per kg. Doing so would help sugar mills manage the higher production costs and support the financial well-being of both mills and farmers.

Exports Could Be the Key to Balancing Domestic and Global Demand

India’s sugar consumption continues to rise, while production estimates for the 2024-25 season remain high. The industry believes that limited exports, in addition to the recent ethanol production boost, would allow sugar mills to remain financially stable without threatening the domestic supply. Exporting 1 million to 2 million tonnes of sugar could help alleviate pressure on mills while ensuring that there is no shortage in the domestic market.

Sugar mills are also pushing for a review of the export restrictions, especially as other sugar-producing countries like Brazil have begun to ramp up exports. The global sugar market remains competitive, and Indian producers want to take advantage of the growing demand abroad.

Conclusion: Time to Consider Strategic Exports

As production costs rise and demand for sugar increases, the sugar industry needs government intervention. By allowing the export of 1-2 million tonnes, India’s mills can maintain liquidity and meet financial obligations to farmers. The coming months will be critical, and industry leaders advise mills to stay cautious yet ready to benefit if export opportunities open up.





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