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Informist, Friday, Jul. 25, 2025

By Afra Abubacker

NEW DELHI – Calls to extend sugar exports beyond the September deadline are premature and meaningless at this stage, Shree Renuka Sugars Executive Chairman Atul Chaturvedi said. Mills should wait for clearer crop estimates for the coming season before seeking additional export quotas for 2024-25 (Oct-Sep), he added.

Chaturvedi's comments come after the Indian Sugar & Bio-energy Manufacturers Association sought the government's permission for an additional 1 million tonnes of sugar exports for the 2024-25 (Oct–Sep) season, with shipments allowed until December. The government had earlier allowed 1 million tonnes of sugar exports till September, of which over 600,000 tonnes have already been shipped. ISMA said a further 1 million tonnes could help address surplus stocks and support mill liquidity amid weak domestic demand and subdued prices.

"In any case, India is likely to see a reasonably big crop in 2025-26 compared to last year. The industry would start clamouring for high exports in the new season as well. The extension of the remaining unsold sugar under the current quota is no big deal," Chaturvedi said.  

He stressed that a clear view on the 2025-26 sugarcane crop is essential before arriving at export decisions. He also cited how initial forecasts had deviated from the actual estimated sugar production in the last two years. Sugar production in 2024-25 is estimated at 26.1 million tonnes, down nearly 20% from 31.9 million tonnes last year. At the start of the season, industry bodies had pegged gross sugar output at over 33.3 million tonnes. 

Chaturvedi recalled past misjudgments in crop forecasts, which led to policy errors. "We made two big mistakes in the last two years. One year, we assumed a bad crop and ethanol suffered when the crop turned out good. Last year, the opposite happened," he said. "Why should we be making decisions before the facts are in our hands?...Let us first see how the crop actually comes up."

Amid lower sugar output estimates for 2023-24, the government restricted ethanol production from sugarcane-based feedstocks as a pre-emptive measure to ensure sufficient sugar availability in an election year. However, actual sugar production turned out better than expected, and excess stocks piled on the back of restrictive policies. The 2023-24 season ended with a high carryover stock of 8.0 million tonnes of sugar, against the ideal 5-6 million tonnes. In contrast, the ongoing sugar season was initially estimated to have higher output, but production is now seen over 18% lower on year. "At this point, it (export decisions) is too premature," Chaturvedi said. 

While global sugar prices remain weak, ISMA has maintained that timely additional quotas could help India retain its place as a dependable global supplier. However, Chaturvedi disagreed. "With the current premium (of Indian sugar), exports are unviable. October onward might look better, but that's still uncertain."

Responding to concerns about export contracts that remain unshipped due to weak global prices, Chaturvedi said the responsibility lies with exporters themselves. "If they have bought the contract, they should be exporting. That is their problem, not the government's, not market forces."

He also dismissed recent US demands for access to India's ethanol market for blending, calling such a move "anti-growth" and detrimental to Indian grain and sugar industries. "As it is, ethanol is already coming in. But on actual user conditions, not for blending," Chaturvedi said. 

The US has raised concerns about India's ban on ethanol imports for biofuel production. While India permits ethanol imports for non-fuel uses, it has banned the import of ethanol for biofuel production since 2019. India blends ethanol with petrol to reduce its dependency on crude oil imports and promote green mobility. 
 

On domestic sugar demand trends, Chaturvedi acknowledged that sugar demand was slipping. "Sugar consumption in the country is coming off a bit...Growth, if any, will likely just match population growth – around 1% a year," he said. According to ISMA, sugar consumption is likely to remain subdued at 27.8–28.0 million tonnes, against 29.0 million tonnes in 2023-24. Local sugar sales last year rose as smuggling to neighbouring countries was accounted as domestic dispatches amid an export ban. 

India is expected to close the current season with stocks of 5.3–5.5 million tonnes, as per ISMA. With production estimated at 26.1 million tonnes and consumption tapering, the industry is watching closely whether the next crop can offset potential surplus pressures. However, Chaturvedi suggests waiting for the crop "to be in our bags" before making export calls or decisions.  End

Edited by Avishek Dutta

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