Indian Oct-mid-May sugar exports 14% more than whole of 2018-19: sources

Singapore — Contracts to export Indian sugar export between the start of the season on October 1 and mid-May totaled 4.2 million mt, around 14% more than in the whole of the previous season despite the coronavirus pandemic, Indian Sugar Mills Association sources and exporters said Tuesday.

Sugar exports in 2018-19 were 3.7 million mt.

"Contracts for export of sugar are being signed for various destinations, with major quantities being signed for exports to Indonesia and Iran," ISMA said in a statement earlier this week.

A total of 3.6 million mt, or 86% of the contracted volume for export, have already been shipped out.

Traders said that both Indian raw and refined sugar has attracted interest from major Asian regional buyers including Indonesia and China as buyers switched their requirements away from Thai sugar this year.

A strong uptick in Thai physical cash values since the start of the year because of a drop in production caused by widespread drought has made Thai sugar uncompetitive, market sources said.

"There is a lack of supply of Thai sugar this year, so our buyers have to look for sugar from other origins. It is also too expensive to get Thai sugar this year," a Singapore based trader said.

Indian low-quality whites are priced at $350-$360/mt, FOB west coast India. That compares with Thai high-quality whites in containers which were trading at an $81/mt premium -- nearly four times higher than at the start of the year -- to London No. 5 August futures Wednesday for prompt June shipment, S&P Global Platts data showed. That means Thai HQW at an outright price of $444/mt are trading at an $84-$94/mt premium to Indian LQW.

India produced 26.5 million mt of sugar until mid-May, down 18.7% on the year due to a weak monsoon, with opening stocks at a record 14.5 million mt because of massive unsold stocks from the 2018-2019 when production hit a record high, according to ISMA.