India extends grace period for sugar exports to July 20 (updated)

Bajaj Hindusthan Sugar

08/07/2022 07:45

(Adds trade comments; paragraphs 3-11)
    By Rajendra Jadhav
    MUMBAI, July 8 (Reuters) - India has extended by two weeks a
deadline for the export of  800,000 tonnes of sugar as annual
monsoon rains make it tough for many producers to move stocks
from factories to ports, the government said on Friday.
    Mills in the world's biggest sugar producer are now allowed
to export the sweetener until July 20, the government said in a
notification, pushing back a previous date of July 5, which some
mills missed after heavy rains impeded transport.
    Industry officials welcomed the longer grace period.
    "This is a very good step," said Aditya Jhunjhunwala,
president of producer body the Indian Sugar Mills Association
(ISMA). "A small quantity was stuck, but that will be exported
before the new deadline." 
    India set the July 5 deadline last month, after having
curbed exports in May, for the first time in six years.
    It capped this season's exports at 10 million tonnes to
prevent a surge in domestic prices after mills sold a record
volume on the world market.  urn:newsml:reuters.com:*:nL2N2XH06I
    Now, the government should allow further exports of 1
million tonnes of raw sugar that mills had produced for export
before the cap, Jhunjhunwala said.
    Additional exports are unlikely to lead to a domestic
shortage as a bumper crop is expected next season, he added.
    India is set to surpass Brazil to become the world's biggest
sugar producer in the marketing year to Sept. 30, ISMA
estimates, with output of 36 million tonnes.   
    As sugar exports are lucrative now, because of firm global
prices and a weak rupee currency, the government should announce
next season's policy immediately, said Rahil Shaikh, managing
director of trading company MEIR Commodities India.
    "Mills and traders can sign contracts for next season now,"
he said. "Even if prices fall after a few months, there won't be
any impact on exports." 

 (Reporting by Rajendra Jadhav; Editing by Clarence Fernandez)
 ((rajendra.jadhav@thomsonreuters.com; +91-22-68414378 ; Reuters
Messaging: rajendra.jadhav.thomsonreuters.com@reuters.net))