“I am not convinced that there is light at the end of the tunnel,” John Stansfield, a trader at Group Sopex SA, said at a Marex Spectron Group seminar in London. “The elephant in the room is definitely India.”
World supply will outstrip demand by 5.8 million metric tons this season after a huge surplus of 11.8 million tons in the prior year, according to Sopex. The glut in global sugar supply is attributed to large production in countries like India and Thailand. Furthermore, there is now no limit on European output since quotas were removed in 2017.
Looking ahead, India is expected to contribute with another record harvest. In an attempt to help struggling mills and reduce the domestic glut in supply, India is expected to export an unprecedented 5 million tons of sugar this season.
“India has been a hot topic all this week,” Tom McNeill, a director at Green Pool, told Bloomberg. “The market would be in a deficit if it weren’t for India. Ultimately, a lot will depend on how Indian millers execute the deals, how the government follows up with subsidies and how the global market reacts.”
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