Indian refiners to divert 250 thsd tons of sugar to domestic market

India’s port-based sugar refineries may divert around 250 thsd tons of refined sugar to the domestic market following a change in trade policy. Previously, such refineries imported raw sugar duty-free, processed it and mainly exported the resulting white sugar.

In August, the Indian government allowed duty-free imports of 1 mln tons of raw sugar in an effort to curb record-high domestic prices. Port-based refineries were also allowed to apply for part of this quota and sell domestically sugar produced from raw material that had already been imported.

According to Shree Renuka Sugars chief executive Susheel Kumar, refineries have already applied for quotas covering around 250 thsd tons of sugar for sale on the domestic market. This is expected to further increase supply in the world’s largest sugar-consuming country.

Following the decision to allow duty-free imports, domestic sugar prices in India have already started to decline, making fresh overseas purchases less attractive. New-season supplies are also expected to put additional pressure on prices.

The government has also asked sugar mills to begin crushing sugarcane from October 15, nearly a month earlier than usual. The move is intended to increase sugar supplies during the peak festive demand period and further stabilize the domestic market.

Tags: sugar, India