As global supplies tighten, several nations have come to depend more on sugar exports from South Asian countries. Uneven rainfall in India’s agricultural belts has raised fear that sugar production would be insufficient to meet global demand and there may be a consistent decline for a second consecutive season beginning in October.

 

Bloomberg reported that this might reduce the nation’s export capacity. To safeguard domestic supplies and maintain prices, the government has already restricted export of non-basmati rice and wheat. This has added to the strain on the world’s food markets, which are already under pressure due to bad weather patterns and the escalating conflicts in Ukraine.

 

 

 

According to Henrique Akamine, head of sugar and ethanol at Tropical Research Services, the government’s decision to limit rice exports is a clear indication that it is worried about both inflation and food security. “The worry right now is that the government will probably follow suit and do something similar regarding sugar,” Bloomberg quoted him as saying.

 

The major sugar cane producing regions in Maharashtra and Karnataka have not received adequate rainfall in June, leading to crop stress, Bloomberg quoted Aditya Jhunjhunwala, the president of Indian Sugar Mills Association (ISMA), as saying. Sugar output is expected to drop by 3.4 per cent from last year to 31.7 million tonnes in 2023-24. Despite this, supplies are expected to meet domestic demand, according to Jhunjhunwala.

 

Meanwhile, India will use more sugar for biofuel. According to ISMA, mills would divert 4.5 million tons to produce ethanol, up 9.8 per cent from the previous year. But Sanjeev Chopra, India's food secretary has called ISMA’s judgment of decreasing sugar production as one that will stoke fears of a shortage in the nation.

 

India has previously controlled its sugar exports. Shipments were limited to 6.1 million tons for the 2022–2023 season, down from 11 million tons the previous season. Analysts predict that only two to three million tons, if not none at all, will be permitted next season, perhaps threatening a further increase in global prices.