Indian sugar market seen finely balanced in 2012/13

India’s sugar market will likely be finely balanced in 2012/13, delegates attending London Sugar Week events said on Thursday.

Speaking to Reuters on the sidelines of his seminar during London Sugar Week, consultant Jonathan Kingsman said a consensus view for Indian sugar production in 2012/13 was 23.3 million tonnes, below Kingsman’s latest official forecast for 24.3 million tonnes.

He added that Indian annual sugar consumption was likely to stand at 23 million tonnes.

“We would expect India to be neither a net importer nor a net exporter – (that is) to be net balanced for the year as a whole (2012/13),” Kingsman said.

His views on India were broadly in line with those of other delegates attending events at London Sugar Week, which gathers hundreds of traders from around the world, culminating in the London sugar trade dinner on Thursday.

India is seen as a key player in the global sugar market because it can swing from one year to the next from being a significant net exporter to importer.

India is the world’s biggest sugar consumer, and number 2 producer after Brazil.

Vinay Kumar, managing director of the New Delhi-based National Federation of Cooperative Sugar Factories, said he expected India to be a moderate exporter in 2012/13.

“It will depend on price,” he said.

Participants at London Sugar Week events said they believed that India had reasonable stocks of some 6 million tonnes at the start of the new season.

“The high white sugar premium and strengthening rupee is encouraging domestic refineries to get on with their import programme,” Kingsman said.

The white sugar premium is the differential between white sugar and raw sugar prices, and is used as a measure of refining profitability.

Participants said that India’s impact on the global sugar market could change markedly in coming months, depending on factors such as price, weather and policy.

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