Central idea:  India’s success story in sugar exports

• India’s sugar exports have soared from $810.9 million in 2017-18 to $4.6 billion in 2021-22, and could cross $5.5 billion in the fiscal year ending March 31.
• The increase is significant in quantity terms too, with India’s shipments increasing from a mere 0.46 lakh tonnes in 2016-17 to 110 lakh tonnes in 2021-22.
• India has gone from being a marginal player in sugar exports five years ago to No. 2 in the world currently, behind only Brazil.

Favourite destinations

• The biggest importers of Indian raw sugar were Indonesia (16.73 lt), Bangladesh (12.10 lt), Saudi Arabia (6.83 lt), Iraq (4.78 lt) and Malaysia (4.15 lt).
• The country also exported 53.71 lt of white/ refined sugar, the leading destinations for which included Afghanistan (7.54 lt), Somalia (5.17 lt), Djibouti (4.90 lt), Sri Lanka (4.27 lt), China (2.58 lt), and Sudan (1.08 lt).
• The highest decline in exports has been registered by the European Union (which produces sugar from beet, unlike India and Brazil that only crush cane): from 39.74 lt in 2017-18 to 8.02 lt in 2021-22.

Which grades of sugar does India export?

• Raw sugar is what mills produce after the first crystallization of juice obtained from crushing of cane.
• This sugar is rough and brownish in color, with an ICUMSA value of 600-1,200 or higher.
• ICUMSA is a measure of the purity of sugar based on color.
• This raw sugar is processed in refineries for removal of impurities and de-colorization.
• The end product is refined white cane sugar having a standard ICUMSA value of 45.
• Till 2017-18, India mainly shipped plantation white sugar with 100-150 ICUMSA value, also known as low-quality whites or LQW in international markets.

Reasons behind India’s surge in sugar exports

• Indian raw sugar is free of dextran, unlike Brazilian raws.
• Indian mills can supply raws with a very high polarization of 98.5-99.5%, which is higher than the polarization of raws from Brazil, Thailand, and Australia.
• Indian raws today fetch a 4% premium over the global benchmark (New York No. 11 futures contract) price, while LQW sells at a $40/tonne discount to the world price (London No. 5 futures) for 45 ICUMSA whites.
• Indonesia agreed to tweak its norms in December 2019 to enable imports from India, which further boosted India’s efforts to push exports of raws.

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