Informist, Monday, Jul. 21, 2025

--ISMA: Urged govt to allow extra 1 mln tn sugar exports in 2024-25 season

--ISMA: Urged govt to allow sugar exports in 2024-25 season till December

By Afra Abubacker

NEW DELHI – Indian Sugar & Bio-energy Manufacturers Association has urged the government to allow an additional 1 million tonnes sugar exports in the 2024-25 (Oct-Sept) season, citing weak domestic demand, depressed prices, lower sugar diversion for ethanol output, and comfortable closing stocks. The government had earlier permitted 1 million tonnes of sugar exports until September, of which over 600,000 tonnes have already been shipped.

Though global sugar prices remain subdued amid record output in Brazil and Thailand, ISMA said permitting additional exports would help Indian traders capitalise on market opportunities as they arise and maintain India's position as a reliable global supplier.

"In a situation where sugar inventories are high and both domestic and global prices remain weak, the government may eventually find it necessary to consider export subsidies to manage excess stocks," according to ISMA's letter accessed by Informist. "This situation can be proactively avoided if an additional export quota of 10 lakh (1 million) tons is allowed now, with staggered shipments permitted up to December 2025," ISMA said in a letter to Food Minister Pralhad Joshi last month.

However, not all are in favour of additional exports amid subdued sugar prices. "In view of lukewarm world prices, we don't see any sense in asking for any additional quota. Current quota (1 million tonnes) could be given extension till December," Prakash Naiknavare, managing director, National Federation of Cooperative Sugar Factories, said. Instead of increasing the export quota for the current season, he suggested a new quota of 2.0–2.5 million tonnes for the next season, to capitalise on the Feb–Apr window when India is among the few suppliers in the global market.

Domestic sugar prices have been under pressure due to a slowdown in demand. ISMA noted that even peak summer months did not push up sugar prices as they have declined by INR 100 per 100 kilograms since March. "Continued low demand is compounding this trend, putting financial strain on mills and affecting their future ability to pay farmers on time," the letter said.

In addition, lower sugar diversion for ethanol production has further added to the sugar surplus. ISMA expects only 3.2–3.3 million tonnes of sugar to be diverted for ethanol production, down from earlier estimates of 4.0 million tonnes. The drop is due to unattractive ethanol procurement prices, which have made ethanol production from B-heavy molasses and sugarcane juice economically unviable, ISMA said.

Meanwhile, sugar demand has also slowed down. Sugar consumption in the first nine months of the season starting in October is estimated to have declined to 20.9 million tonnes from 22.1 million tonnes a year ago. Full-season consumption is likely to remain subdued at 27.8–28.0 million tonnes, against 29.0 million tonnes in 2023-24, ISMA said.

With the slowdown in sugar demand and reduced sugar diversion for ethanol production, India is likely to end the 2024-25 season with a healthy closing stocks of 5.3–5.5 million tonnes as of September end. The season began with a high opening stock of 8.0 million tonnes, while sugar production is estimated at 26.1 million tonnes.

For the upcoming 2025-26 season, ISMA expects better sugarcane output due to favourable monsoon in Maharashtra and Karnataka. Usage of improved cane varieties in Uttar Pradesh and other northern states is also likely to give better yields and higher recovery, it added. End

Edited by Akul Nishant Akhoury

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