MUMBAI: India plans to extend a ban on sugar exports for the second straight year as the world’s biggest consumer of the sweetener grapples with the prospects of lower cane output, government sources said.

New Delhi also plans to raise the price at which oil companies buy ethanol from sugar mills as part of efforts to boost supplies of the biofuel, said the sources with direct knowledge of the matter.

They did not wish to be identified as deliberations were not public. India’s absence from the world market would further squeeze global supplies, propping up benchmark prices in New York and London.

New Delhi plans to prohibit mills from exporting sugar when supplies from Brazil, the world’s top producer and supplier of the sweetener, are expected to drop because of a drought in the South American nation.