India has so far contracted to export 1.3 million tonnes of sugar in the 2015/16 marketing year started on October 1, of which 1 million tonnes have already been exported, head of a trade body said on Thursday. Exports from the world's second biggest producer could limit a rally in global prices.
Chinese imports via Myanmar are helping Indian mills in their efforts to sell overseas, said Abinash Verma, director general of the Indian Sugar Mills Association. The government has previously set a target of 3.2 million tonnes of exports for this season. Volumes of white sugar shipped to Myanmar have been rising due to a jump in smuggling to China because of high domestic prices.
A rebound in sugar prices in India on the expectation of lower production has slowed down exports, Verma told Reuters on the sidelines of an industry conference in Moscow on Thursday. The first back-to-back drought in nearly three decades has hit cane plantations in the top producing western state of Maharashtra and the third biggest producer Karnataka. "These reports suggest that the next year's cane crop might be lower than this year," Verma said. He declined to estimate the size of next year's crop. In the current season the south Asian country could produce 26 million tonnes of sugar, he said.
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