India’s sugar Export Decision to Ease Price Rally in East Africa
India’s approval of limited sugar exports is expected to help stabilise prices in East Africa, where rising costs have squeezed consumers.
New Delhi on Monday authorised the export of one million tonnes of sugar for the current season ending September 2025, a move aimed at addressing surplus stocks and propping up domestic prices, according to the Food Ministry.
The decision comes as India, the world’s second-largest sugar producer, faces its first production shortfall in eight years, with output projected to fall to 27 million tonnes against consumption of over 29 million tonnes.
Despite this decline, the Indian government allocated mills an export quota of 3.174 percent of their three-year average production, allowing direct or merchant exports.
“This measure ensures revenue for mills, enabling them to make timely payments to 50 million sugarcane farmers,” Food Minister Pralhad Joshi is quoted by reutey, adding that the move is also intended to stabilise local sugar prices, which have been under pressure in recent months.
The export quota comes as a surprise to some traders, given India’s production challenges, but the decision offers a potential lifeline to East African countries.
Many nations in the region, including Kenya, Uganda, and Tanzania, rely heavily on imports to bridge their annual demand for sugar, a critical commodity.
East Africa has recently faced rising sugar prices due to supply chain disruptions and a decline in global sugar production, exacerbated by India’s earlier indication that exports might be restricted
India’s allocation is expected to alleviate some pressure on global markets, where prices had softened by over one on Monday following the announcement.
“This decision balances India’s domestic needs while providing relief to global markets,” Deepak Ballani, director general at the Indian Sugar & Bio-Energy Manufacturers Association told Reuters.
Exports not only generate vital revenue for India’s mills but also ease supply constraints for sugar-deficient regions like East Africa.
The region remains particularly vulnerable to price fluctuations due to its dependence on imports.
With domestic production often falling short of demand, East African nations turn to major exporters like India and Brazil to supplement their supplies.
India’s decision to allow exports, even in limited quantities, is expected to stabilise prices and ensure steady supply in the coming months.
gandae@businessdayafrica.org