India's Sugar Export Push Hits a Roadblock as Mills Demand High Premiums

Indian sugar traders are struggling to secure export contracts despite the recent approval of a 1 MMT sugar export quota. Mills are holding out for hefty premiums, which global buyers are unwilling to pay, according to trade sources.

Before the export approval, Indian sugar prices traded at a significant discount to global levels, making exports highly profitable. However, domestic prices surged nearly 10% following the quota announcement, while global prices eased, narrowing margins and diminishing export incentives for mills. With the export window open until September, mills are in no rush to finalize deals. Many are adopting a wait-and-watch approach, banking on a rebound in global prices to make exports more attractive. The standoff highlights the gap between domestic pricing expectations and global market realities, potentially delaying re-entry into the export market.