East Africa Braces for Elevated Sugar Prices as India's poor crop slashes exports
East Africa is facing the prospect of rising sugar prices as India, the world’s second-largest producer of the commodity, struggles with a poor crop.
A combination of last year’s drought and this year’s excessive rains has reduced yields, a move that might prompt the South Asian nation to curb exports in the current season, which ends in September 2025.
India is projected to produce 27 million tonnes of sugar in the 2024/25 season, a steep drop from last year’s 32 million tonnes and below its annual consumption of over 29 million tonnes.
The decline marks the first time in eight years that India’s production will fall short of domestic demand.
As one of the world’s largest sugar exporters, India plays a critical role in meeting the needs of sugar-deficient African nations, many of which rely on imports to satisfy their annual consumption.
The poor crop has been attributed to prolonged drought in 2023, which stressed sugarcane crops during the summer, followed by excessive rainfall during the monsoon season, which hampered growth, according to B.B.Thombare, president of the West Indian Sugar Mills Association who is quoted by Reuters.
Trade houses have slashed output estimates, citing reduced yields in Maharashtra and Karnataka, where reservoir levels were depleted by lower-than-average rainfall last year.
Farmers in these regions reported yields dropping from the usual 120 to 130 tons per hectare to just 80 tons.
“Drought stress during the summer months and excessive monsoon rains with limited sunshine have caused severe damage to our crops,” Thombare said.
In Uttar Pradesh, the country’s leading sugar-producing state, drought conditions spared the crop, but red rot disease affected plantations, further reducing yields.
Local authorities are now advising farmers to adopt disease-resistant sugarcane varieties to mitigate future losses.
India’s decision to restrict sugar exports could tighten global supply and drive up prices, adding pressure on African nations that rely heavily on imports.
The situation is likely to exacerbate inflation in East Africa, where sugar is a staple commodity and prices are already elevated due to high input costs and logistical challenges.
ligadwah@businessdayafrica.org