India has banned the export of sugar, including raw sugar, white sugar and refined sugar, with immediate effect until September 30 this year or further orders. While exports were already “restricted” under the current policy, the Commerce Ministry revised the policy to “prohibited” in the notification issued on Wednesday, May 13.
India is the world’s largest sugar exporter after Brazil.
The Ministry of Commerce said that this ban will not apply to sugar exported to the European Union and the United States of America under CXL and TRQ quotas, respectively.
However, this prohibition does not apply to sugar consignments that fall under three categories – they are loaded on ships for export; The bill of lading has been submitted and the vessel has docked or arrived and docked at an Indian port, with its turn number allocated by the Port Authority; When a shipment of sugar is delivered to customs or a guard it is recorded in their electronic system, with verifiable proof of the date and time of this delivery.
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If sugar shipments fell under any of these three categories before the ban notice was issued on Wednesday, they will be relaxed under the new policy.
In addition, apart from sugar exports to the USA and EU under their respective quotas, some other sugar exports will also fall under this ban, which includes – prior authorization regime, government-to-government exports, and shipments already in physical export pipelines.
The move is expected to give a boost to global sugar prices and may allow rival exporters, including Thailand and Brazil, to ship more to Asian and African buyers, Reuters news agency reported.
Following India’s ban on sugar exports, raw sugar futures in New York rose by more than 2 percent, while white sugar futures in London rose by 3 percent.
The report stated that this move also comes amid weak sugar production in key growing regions after India allowed mills to export 1.59 million metric tons of sugar, expecting production to be higher than the domestic need.
Now, with expected extreme weather conditions due to El Niño and its impact on the monsoon, production is at risk of further blows.
(With inputs from Reuters)
