Central Govt Plans to Regulate Sugar Exports from 1st June, 2022

Government has decided to allow sugar exports of up to 100 LMT in order to maintain domestic availability and price stability during the 2021-22 sugar season (October-September). According to the DGFT order, from 1 June 2022 to 31 October 2022, or until further order, whichever is earlier, sugar export will be permitted with specific permission from the Directorate of Sugar, Department of Food and Public Distribution.

The decision was made in light of record sugar exports. Only about 6.2 LMT, 38 LMT, and 59.60 LMT of sugar were exported during the sugar seasons of 2017-18, 2018-19, and 2019-20, respectively. In the sugar season 2020-21, 70 LMT were exported against a target of 60 LMT.

During the current sugar season 2021-22, approximately 90 LMT of contracts for export have been signed, approximately 82 LMT of sugar has been dispatched from sugar mills for export, and approximately 78 LMT has been exported. Sugar exports are at an all-time high in the current sugar season (2021-22).

The decision will ensure that the closing stock of sugar at the end of the sugar season (30th September 2022) remains 60-65 LMT, which is 2-3 months stocks (monthly requirement in those months is around 24 LMT). Crushing in the new season begins in the last week of October in Karnataka, in the last week of October to November in Maharashtra, and in November in Uttar Pradesh. In general, sugar supply occurs from May to November.

Taking into account the unprecedented growth in sugar exports and the need to maintain sufficient stock of sugar in the country, as well as the need to protect the interests of the country's common citizens by keeping sugar prices under control, the Government of India has decided to regulate sugar exports beginning on June 1, 2022. Sugar mills and exporters must obtain approvals from the Directorate of Sugar, Department of Food and Public Distribution in the form of Export Release Orders (EROs).

The government has been closely monitoring the situation in the sugar sector, including sugar production, consumption, export, and price trends in wholesale and retail markets across the country. In the current fiscal year, India was the world's largest producer and second-largest exporter of sugar.

Despite record sugar production, the government of India has paid 99.5 percent of cane dues for the previous sugar season 2020-21, and about 85 percent of cane dues for the current sugar season 2021-22 have also been released to farmers.

The Government of India is committed to maintaining stable sugar prices in the domestic market, and sugar prices have been under control for the past 12 months. Sugar wholesale prices in India are controlled in the range of Rs 3150-Rs 3500 per quintal, while retail prices are also controlled in the range of Rs 36-44 in various parts of the country.