Indonesia is the largest importer of Indian sugar in the first three months of 2021, according to AISTA (All India Sugar Trade Association). Other countries that are engaged in from India are Iran, Sri Lanka, Sudan, Somalia, United Arab Emirates, Afghanistan, Bangladesh, Pakistan and China. The top ten export partners of India were responsible for as much as 76.2% of exports in 2020.
Sugar is the sweet tasting and soluble carbohydrate that is acquired from sugar cane and sugar beet. The two largest producers are Brazil and India. Brazil is responsible for 42% and India 33% of the total sugar production globally in 2020. Other major producers are the European Union, China, and Thailand.
Independent traders in India can take inspiration from such developments and learn more about trading prospects of sugar online with the leading importing countries.
Sugar industry, Import of sugar in India
Sugar industry in India provides livelihood to approximately around 50 million sugarcane farmers and around 5 lakh workers employed at the sugar mills. This agro based industry provides ancillary employment pertaining to transport, trade servicing of machinery, and supply of agricultural inputs as well.
According to the Department of Food & Public Distribution, Government of India, the annual output of the Indian sugar industry is worth approximately INR 80,000 crores in December 2021. The production of sugar in India is estimated at 31 million tons in the current 2020-21 sugar season.
Currently, the prospects for sugar industry in general and sugar import and export in particular from India is looking good. In early August 2021, the exports of sugar from India exceeded the 5-million mark, with Indonesia being the largest buyer. The sugarcane revenue has more than doubled in the last ten years; it has increased from INR 1391 per ton in sugar season 2011 to INR 2850 per ton in sugar season 2021.
Indonesia – the largest buyer of Indian sugar in first quarter of 2021
According to All India Sugar Traders Association (AISTA), India had dispatched 55% of the sugar export quota announced by the Government under the Maximum Admissible Export Quota (MAEQ) 2020-21 scheme, as of April 2021. In the first three months, Indonesia emerged as a top importer of Indian sugar and was responsible for 38 percent of the total sugar that was dispatched. This scheme had been announced by the government in January 2021 to make exports lucrative and bring down the surplus sugar that was available in the domestic market.
Afghanistan – one of the top destinations of Indian sugar exports
Another country which is proving to be a major destination of Indian sugar is Afghanistan. Indonesia along with Afghanistan was responsible for about 48 percent of the total Indian sugar exports shipped out during the period of October 2020 – March 2021.India exports around 6,00,000-7,00,000 ton of the sweetener to Afghanistan annually. In the current 2020-21 sugar season ending on September 2021, about 6,50,000 ton of sugar has already been exported, as per trade data.
However, export of sugar to Afghanistan almost stopped when the Taliban ousted the government and took over the control of the country after capturing Kabul. Several Indian merchants reported cancellation of orders; however, once normalcy is restored under the new regime, the import of Indian sugar is expected to pick up in the next sugar season.
Srilanka – importing sugar to stabilize commodity prices
The government of the country has decided to import sugar from India as of July 2021 to bring down the increasing prices of commodities in the country. The cabinet of the country has allowed import of around 2500 tons of sugar every month from India. It has also decided to retail through state agencies.
Srilanka has a history of importing from India. As a matter of fact, it was the largest sugar importer during the 2018-19 sugar season contributing nearly half of the total exports that year.
China – signing a memorandum of understanding with India to purchase raw sugar
China has signed a MOU with India to procure 50,000 ton of raw sugar, which would be exported to four refineries in China. On an average, the country imports around 50 lakh ton of sugar annually from India.
India is the largest producer of sugar in the world, producing all three varieties of the sweetener which are raw, refined and white sugar. Indian sugar is Dextran free because of the very less amount of time taken from cut to crush. India has the capabilities and the potential to become a regular and dependable exporter of high quality sweetener in large volumes to China in the future.
The imports of sugar in China is estimated to grow at an annual rate of 5.8 percent for the next ten years and reach around 5.52 million tons in 2030, according to a report published by Ministry of Agriculture and Rural Affairs of China. This high level of imports is backed by an increasing consumption of sugar in the country, which is estimated to grow at a rate of 0.9 percent annually, reaching around 16.44 million tons in 2030. The self-sufficiency rate of China is stable around 70 to 80 percent. China exports sugar from India and other countries from Southeast Asia and South America.
United Arab Emirates – India’s third largest trading partner with $59.12 billion trade in 2019-20, a non-Covid period
The two countries have decided to draw up a comprehensive trade negotiation by December 2021 and sign on a formal trade agreement by the first part of 2022 with the objective of achieving over USD 115 billion in bilateral trade in the next five years. Is assuming a lot of significance because of these initiatives.
India is appreciative of UAE for its support during the lockdown scenario, which included supply of liquid medical oxygen, medicines and also keeping the supply chains open.
UAE is an important trade ally for India and the second largest export destination after the US, with exports valued at USD 29 billion in 2019-20. Sugar prominently features among the major food exports to the UAE from India that also includes cereals, fruits, and vegetables. Other major items exported from India to the UAE include petroleum products, precious metals, stones, gems and jewelry, minerals, textiles, engineering and machinery products, and chemicals.
The top imports from the UAE were petroleum and petroleum products, precious metals, stones, gems and jewelry, minerals, chemicals, and wood and wood products.