Reuters
Business
Tranportation woes delay Indian sugar exports
Fri, Jan 18 04:25 AM EST

By Abhishek Shanker & Rajendra Jadhav

MUMBAI (Reuters) -India's sugar exports are getting delayed due to a shortage of trucks and rail wagons for transportation to ports, resulting from a surge in exports of various commodities, industry officials said.

There is robust demand for agricultural commodities, especially for cotton, soymeal and sugar, from overseas markets, and exports are set to rise in the crop year to September 2008.

India aims to export around 3 million tonnes of sugar in the crop year to September 2008, from 1.7 million tonnes a year ago.

"The only problem we are encountering is that arrival of sugar from the hinterland is not in the order. Though we have the ship alongside the berth, the cargo doesn't come from the hinterland," a senior official at Mumbai port said.

Sugar factories in Maharashtra, the biggest producing state, are exporting mostly in the raw form through Mumbai and the Kandla port in Gujarat, which have adequate facilities.

"We have to export about 20,000 tonnes of sugar in next 15 days but we are facing severe shortage of trucks which would carry sugar to the port." Kantilal V. Shah, chairman and managing director, Gill & Co Pvt Ltd, said.

Gill & Co aims to export about 320,000 tonnes of sugar in the current season, from 30,000 tonnes a year before.

Sugar factories are unable to get trucks and rail wagons which is delaying shipping process, said Balasaheb Patil, president of Maharashtra Cooperative Sugar Factories Federation.

India, the world's second-biggest sugar exporter, has shipped 354,000 tonnes of the sweetener in first three months of the year beginning October, a government source told Reuters on Jan. 8.

India stopped sugar exports in July 2006 to tame inflation and allowed it in Jan 2007 to avoid a glut in domestic markets.

"There is cotton, sugar, soymeal and everybody wants to reach the port...where are the trucks?," Shah of Gill & Co said.

The market arrivals of sugar, cotton and soybean usually starts from end-October. Sugar factories prefer the road route, as transportation through railways increases loading and unloading operations, he added.

India's soymeal exports in 2007/08 season may touch 4.5 million tonnes, a senior industry official said. Soymeal exports in 2006/07 stood at 3.4 million tonnes.

In 2007/08, India is likely to export 6.5 million bales of cotton, up from 5.8 million bales a year earlier. Earlier this month, Dubai's Al Khaleej refinery said it has bought more than 100,000 tonnes of Indian raw sugar for 2008 shipment.

India is likely to produce 26 million tonnes of sugar in the year ending September, 2008, against 28.4 million tonnes produced a year ago. The domestic consumption is about 20 million tonnes.


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