India may cut sugar exports in the year through September 2023 to safeguard domestic supplies and on expectations for higher biofuel demand, according to people with knowledge of the matter.  

The world’s second-biggest producer may permit sugar mills to ship 9 million tons, lower than the 11.2 million quota for 2021-22, said the people who asked not to be named as they’re not authorized to speak publicly.

An email sent to the food ministry’s spokesperson was not immediately answered. A spokesperson of the commerce ministry was also not available.

The reduction in shipments from last year could tighten global supplies after rains in some areas of top exporter Brazil slowed the pace of cane crushing. New Delhi was earlier planning to allow just 8 million tons of exports, but may now increase that marginally due to estimates for a bigger domestic surplus, the people said.  

The government is considering to allow exports of 6 million tons in a first tranche, and another about 3 million in a second, based on the pace of production, said the people.

Sugar exports from India used to be unregulated, but the country imposed limits last year to ensure sufficient local supply. The government said on Saturday that it will extend the restrictions until October next year. However, the curbs don’t apply to sugar exported to the EU and the US under some quotas, it said. 

Sugar production in India is forecast at 35.5 million tons this year that started in October, according to the Indian Sugar Mills Association. The country was the biggest exporter after Brazil in 2020-21 and counts Indonesia, Bangladesh, Malaysia and the United Arab Emirates among its customers. India is also the world’s biggest consumer of sugar.