India is expected to ban sugar exports in the upcoming season commencing in October due to reduced cane yields caused by insufficient rainfall, Reuters news agency reported on Thursday, citing Indian Government sources.
If such a ban is implemented, it would be the first time in seven years and could potentially result in elevated global sugar benchmark prices. This, in turn, has the potential to contribute to inflation in global food markets, according to the report.
During the current season until September 30, India permitted mills to export a limited quantity of sugar, specifically 6.1 million tons. This allocation is in contrast to the previous season when mills were allowed to sell a record-breaking amount of 11.1 million tons.
In July, retail inflation in India surged to its highest level in 15 months, reaching 7.44 percent. Food inflation also experienced a significant increase, reaching 11.5 percent, which is the highest it has been in over three years.
Furthermore, it is anticipated that India's sugar production will decline by 3.3 percent to approximately 31.7 million tons in the 2023/24 season.
Last month, India, which accounts for 40% of world rice exports, banned exports of most types of rice to curb price hikes in the domestic market.