The demand of Sugar from sweet-toothed people in India will likely see a reduction than expected as mall and restaurants closures due to a nationwide lockdown cut consumption of desserts, ice cream and beverages. Demand from the second most populous nation on earth, the world’s largest consumer, may amount 25 million tons to 25.5 million tons in the year that began Oct. 1, compared with 26.5 million tons expected earlier said the director general of Indian Sugar Mills Association, Abinash Verma. That’s compared with 25.5 million tons in 2018-19, he said.
A reduction in demand will add to record stockpiles and potentially cut local prices. This development may prompt some sugar mills to boost overseas sales in a bid to cut down their carrying costs. Indian sugar mills had inventory of about 14.6 million tons on Oct. 1, enough to satisfy home demand for over six months.
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Consumption of the sweetener increased by nearly 1 million tons in the five months ended February, however sales may drop by about 1.5 million tons in 2019-20 mainly due to the restrictions from the lockdown that was announced in March. This however cut demand for the sweetener from manufacturers of cookies, sweets, ice cream and soft drinks. Industrial use accounts for as much as 65% in India. Local traders may purchase 200,000 tons to 500,000
“Sugar sales have been affected due to lockdown across the country,” Verma disclosed in an interview on Wednesday. “After the lockdown is eased there may be some spike in demand from traders to refill the pipeline stocks immediately.”
According to Verma, Indian mills have already shipped 3.6 million tons out of about 4.2 million tons contracted for exports so far in 2019-20.
“Indonesia will continue to import sugar from India as sugar production in one of their main suppliers.”
“Thailand is going to fall sharply due to a drought,” . Verma mentioned that Iran and Indonesia are offering higher prices compared with world market rates, he said.
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