India is considering restrictions on sugar exports for the first time in six years and may cap exports at around 8 million tonnes in an effort to prevent domestic prices surging, government and industry sources said.

Any curbs on exports by the world's second biggest sugar exporter could lift global sugar prices that have been supported by lower output in top producer Brazil and firm crude oil prices, which encourages mills to produce more sugarcane-based ethanol.

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"Sugar output is going to be a record high, but stocks are depleting fast because of exports. Uncontrolled exports could create scarcity and local prices could spike during festive season," said a senior government official with knowledge of the matter who asked not to be identified.

Cashing in on rising global sugar prices, Indian mills have contracted to export around 7 million tonnes of the sweetener, so far in the 2021-22 marketing year ending on September 30, dealers said.

The Ministry of Commerce and Industry did not immediately respond to a request for comment.

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(Text input from Reuters)

First Published:Mar 25, 2022 3:27 PM IST