India’s sugar exports have come to a halt as dealers have not signed new contracts in the past five days after local prices surged on expectations of lower output, trade sources said on Tuesday.
India, the world’s biggest sugar producer after Brazil, has contracted to export 1.6 million tonnes since the season began on Oct. 1. Dealers have shipped out 1.3 million tonnes so far.
Local prices have surged nearly 8 percent in the past 10 days after India, also the world’s top consumer of the sweetener, cut its output estimate by 1.4 percent from an earlier forecast. Output is expected to fall this season after six straight years of surplus production.
The government was instrumental in persuading mills to agree to a target of 3.2 million tonnes of sugar exports in 2015/16. With forecasts of lower output and higher local prices, traders say India may not be able to meet its export target.