Indian Sugar Export Struggles Amid Premium Pricing
Indian sugar traders face challenges in finalizing export contracts despite government approval for 1 million metric tons. Mills demand premiums over London prices, deterring buyers. Local prices surged by 10%, prompting mills to delay deals, expecting higher global rates. So far, 20,000 tonnes have been contracted for February at $490-$510 per ton, exceeding London futures.
Indian traders find themselves in a predicament as they attempt to finalize sugar export contracts. Despite New Delhi’s authorization to export 1 million metric tons, mills are demanding premiums over London prices, leaving overseas buyers hesitant to commit, according to trade sources.
The world’s second-largest sugar producer, India, is experiencing a slowdown in shipments, a situation that has kept global sugar prices buoyant after reaching a three-year low. India recently permitted the export of 1 million tons to boost local prices and offload surplus stocks, but local rates surged by nearly 10%, prompting mills to seek significant export premiums.
Mumbai-based dealers report that mills are not rushing to sign deals, anticipating a rise in global prices. Traders have contracted 20,000 tonnes of sugar for February shipment at $490 to $510 per ton, surpassing London futures by $10 to $25. This situation highlights the complexity of India’s position as a major sugar exporter.
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Source : Devdicourse
