India to export 50,000 tonne more sugar to Pakistan

India will export 50,000 tonne of sugar to Pakistan at $473 a tonne cost-and-freight, after exporting an equivalent quantity late last month, a senior industry official said on Monday. The consignment will reach the Karachi port in Pakistan in five to seven weeks.

The new contract to sell another 50,000 tonne sugar has been awarded to Indian Sugar Exim Corporation, the official said.

Pakistan, which is importing sugar from a number of countries to check spiralling prices, had floated the import tender late last month.

The tender, floated by state-owned Trading Corporation of Pakistan, had closed on Friday. The contract for exporting 50,000 tonne of sugar to Pakistan has an option of raising the quantity to 1,00,000 tonne, the official said.

Indian Sugar Exim Corporation had submitted a bid price of $473.85 per tonne but agreed to a lower price on assurance of further export order from the country.

The May sugar contract on the London International Financial Futures and Options Exchange had on Friday closed at $453 per tonne, up $5 from the previous close.

A sharp rise in domestic sugar prices prompted Pakistan to lift a four-year ban on imports from India due to severe supply crunch there. The country is likely to produce only 2.5 million tonne sugar in the current October-September season against a demand of 3.8 million tonne, while India's output is pegged at 18.5 million tonne, up from 13 million tonne last year.

Indian mills need to export 2 million tonne white sugar in lieu of the equivalent amount of raw sugar imported in the last season in the wake of severe cane shortage due to drought.

Under the advance licence scheme, Indian manufacturers have to export white sugar in quantities equivalent to the raws imported within 24 months.

The Indian government does not allow free exports of the sweetener, as it is an essential commodity.

Late last month as well, Pakistan had bought 50,000 tonne sugar from Indian Sugar Exim Corporation at $478 per tonne.

Apart from Indian Sugar Exim Corporation, Pakistan had also invited import bids from the UK's Louis Dreyfus Trading Ltd, Glencore UK Ltd, Tate & Lyle Sugar Trading and Czarnikow Sugar Ltd.

Other bidders included United Arab Emirates' Wellington Marketing and Al-Khaleej Sugar Company and Switzerland's Eridania (Suisse) SA and Cargil International, Hong Kong-based Nobel Resources Ltd, Brazil's ProSugar Cane Brazil Ltd, Tansorbis Llc of the US, and the Singapore-based Agrocorp International.