The Food Ministry has issued export order for 2.32 lakh tonnes of sugar out of total 10 lakh tonnes the government had allowed for overseas shipments in 2011-12 marketing year (October-September).

Sugar mills cannot export the sweetener without release order from the Food Ministry.

On November 22, 2011, an Empowered Group of Ministers (EGoM) on food, headed by the Finance Minister, Mr Pranab Mukherjee, had allowed mills to export 10 lakh tonnes under Open General Licence (OGL) in the 2011-12 marketing year (October-September).

The decision was notified on December 2, and 10 lakh tonnes was allocated to the mills based on their average output over the last three years.

According to the latest data, the Ministry has issued export release order for 2,32,454 tonnes within a month after the notification. Mills have been given 45 days time from the notified day to apply for export release orders, which will be valid for 60 days.

The EGoM had decided to allow sugar exports, although with a quantity restriction of 10 lakh tonnes, as the country’s output is estimated to outstrip demand in 2011-12.

In the 2010-11 marketing year, the government had allowed 26 lakh tonne of exports, out of which 15 lakh tonnes was through OGL in three tranches.

Sugar production in India — the world’s second largest producer and the biggest consumer — is estimated at 25-26 million tonnes in this marketing year. The country’s annual demand is pegged at 22 mt.

In 2008-09 and 2009-10, sugar production was below domestic consumption, at 14.53 mt and nearly 19 mt, respectively. The country had to import about 6 mt to meet the shortfall.

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