In a move likely to ease the financial pressure on sugar millers, the government has officially approved the export of 10 lakh tonnes of sugar. The decision comes after weeks of speculation and discussions regarding the export.
The approval is expected to provide much-needed relief to sugar millers who claim to have been grappling with financial instability. It will help mills clear outstanding cane dues on time, alleviating some of the pressure on the sector.
Union Food Minister Pralhad Joshi in a tweet on X said, “Guided by the visionary leadership of Hon’ble PM Shri @narendramodiji, the Government of India has approved a 10 LMT sugar export quota for 2024-25. This ensures price stability, supports 5 crore farmer families, 5 lakh workers, and strengthens the sugar sector.”
Export quota of 10 LMT have been prorated amongst those sugar mills which operated in at least one sugar season amongst the last three sugar seasons by taking into account their average production of sugar during the last three operational sugar seasons i.e. 2021-22, 2022-23 and 2023-24.
All the sugar mills have been allocated a uniform export quota of 3.174% of their 3 years average production of sugar.
The new sugar mills which have commenced sugar production for the first-time during sugar season 2024-25 or the mills which were closed in the previous three sugar season(s) but have restarted in the sugar season 2024-25 have also been allocated export quota of 3.174% of their estimated sugar production in sugar season 2024-25 duly verified by respective Cane Commissioner.
Modalities to undertake export of sugar are as under:-
(a) Sugar mills can export quantity of sugar mentioned in Annexure either themselves or through merchant exporters/refineries from the date of issuance of this order until 30.09.2025. The last BL (Bill of Lading) date shall be on or before 30.09.2025.
(b) Those sugar mills which are not willing to export sugar can surrender their export quota (partially / whole) on or before 31.03.2025.
(c) Mills can also exchange their export quota (partially/ whole) with domestic quota of any other sugar mill till 31.03.2025. Exchange of export quota with domestic quota would reduce transportation cost involved in export of sugar & movement of sugar from one state to another for domestic consumption. For example, if a mill in Punjab or Uttar Pradesh far away from port does not wish to export due to higher transportation cost involved can exchange its export quota with monthly domestic release quantity of any other mill located nearer to the port.
(d) Modalities for exchange of export quota quantity with the quantity of monthly release quota are as under:
(i) Those sugar mills who do not wish to export the allocated quantity (whole/partial) allocated to them as per Annexure, may exchange their export quota quantity with the monthly release quota of any other sugar mill which is willing to take the additional export quota quantity for export.
(ii) The sugar mills involved in such exchange of their export quota with domestic monthly release quantity are required to enter into an agreement and submit it to DFPD for reallocation of their export quota, as well as monthly release quantity.
(iii) Requests for export swapping may be shared on sugarexport25- fpd@gov.in from the email ID registered on NSWS portal or the authorised email IDs of both the sugar mills. Requests sent on any other email ID of DFPD or DSVO shall not be considered.
(iv) The export quota exchanged with monthly release quantity shall be adjusted by the end of current sugar season 2024-25 i.e. till 30.09.2025. The monthly release quantity against the export quota shall be adjusted beginning from the release for the next month after issuance of exchange order, in five equal monthly instalments. Sugar mills shall apply for exchange of their domestic quota with export quota to the maximum limit of their average monthly release for subsequent five months of last three sugar seasons. For example, if a sugar mill exchange its export quota in the month of March, in the instant case, the average domestic release shall be calculated from April-August during the last 3 sugar seasons.
(v) DFPD will issue orders for exchange of export quota with domestic quota on fortnightly basis.
(vi) Exchange of export quota with domestic quota once permitted will not be reversed.
Exporters/ sugar mills/ refinery can export only the export quota quantity allocated to sugar mills; and sugar purchased from open market or from domestic quota of sugar mill is not allowed to be exported by any sugar mill/ exporter/ refinery.
Those sugar mills which have violated the policy guidelines issued by the DFPD order No. 5-1/2024-SC (386427) dated 26.07.2024 for action to be taken against violation of monthly stockholding limit orders for sugar or the mills which have defaulted government dues pertaining to this Department are not being allocated any export quota during the current sugar season i.e. 2024-25.
Earlier, the Indian Sugar and Bio-Energy Manufacturers Association (ISMA) had appealed to the government to allow the export of sugar during the ongoing season.
ISMA had stated that the export of sugar in the current season would not only ensure a comfortable stock for domestic consumption and sustain the Ethanol Blending Program (EBP) but also help maintain the financial liquidity of sugar mills, thereby facilitating timely payments to farmers.
Sugar exports were capped at around 11 million metric tonnes (MMT) in Sugar Season (SS) 21-22, approx 6 MMT in Sugar Season 22-23, and were not permitted in Sugar Season 23-24.
The decision will help millers financially and also assist in clearing cane dues on time. It is also likely to boost the domestic sugar price, which has already increased by Rs 200 per quintal from the recent lower levels following the export news. The market will remain bullish after the export decision, providing further relief to mills.
Click here to read the sugar export notification
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