India allows wheat and sugar exports to ease farmer protests amid US trade deal

The government of India on Friday approved the export of 2.5 million tons of wheat and an additional 500,000 tons each of wheat products and sugar, aiming to support local farmers amid protests over a trade agreement with United States. On Thursday, thousands of farmers demonstrated, claiming the deal could harm their interests, although the trade minister assured that safeguards were in place.

In a statement, the federal government said the decision was intended to stabilize domestic markets and ensure financial returns for farmers, following a review of current supply and price trends. Last month, authorities allowed the export of 500,000 tons of wheat flour and other wheat products, and in November, 1.5 million tons of sugar were approved for export for the season starting October 1.

Traders noted that the export approval could boost sentiment in the domestic market, but meeting the allocated volumes may be challenging due to high Indian prices. Indian wheat is offered at around $280 per ton FOB, compared with about $200 per ton for Argentine supplies. Neighboring Bangladesh is securing higher-quality wheat at approximately $260 per ton C&F.

India banned wheat exports in 2022 following extreme heat that reduced yields, and the ban was extended in 2023 and 2024, leading to record domestic prices and speculation that India might import wheat for the first time since 2017. However, conditions improved in 2025, with favorable weather, high-yielding climate-resilient seeds, and sufficient soil moisture from two consecutive monsoons, raising the likelihood of another strong harvest. India produced a record 117.9 million tons of wheat in 2025.

Regarding sugar, of the 1.5 million tons approved for export this season, around 197,000 tons had been shipped as of January 31, with an additional 272,000 tons contracted. An extra 500,000-ton quota will be made available to mills that ship at least 70% of their previously allocated quantity by June 30.

According to Deepak Ballani Director General of the Indian Sugar & Bio-Energy Manufacturers Association, weak global prices have made it difficult for mills to fulfill their export quotas. As a result, the additional 500,000-ton allowance is unlikely to significantly change the industry outlook, though it may slightly ease domestic supply pressures. Indian sugar is currently offered at around $445 per ton FOB, nearly $50 above the benchmark London futures.

Tags: wheat, India, export, sugar