Global markets brace for another bumper sugar harvest in India. Government will protect sugar subsidies at all costs despite WTO fight, official says.
Cane is King: This year's more-than-average rainfall has led to more-than-full reservoirs. And this will likely lead to more-than-enough sugarcane plantation.
As India looks ahead to more bumper cane crop, global markets are not pleased. For the past two years, sugar prices have been stuck in a glut, and this has been blamed on India's bumper harvests and export subsidies. A group of countries even approached the WTO to resolve the issue.
And now, with the country set to return to record outputs, sentiments will likely sour again and the sugar markets will be roiled. BBG Quint
Brazilian Ire: Of all countries, Brazil is likely to be particularly peeved. Along with India, it is among the largest sugar-producing nations in the world, and it fears Indian exports will undercut its prices. Which is why, along with Guatemala and Australia, it had approached the WTO to take action against India's oversupply.
But the Indian government is reportedly willing to protect its cane subsidies "at all costs" and is confident of fending off Brazil's attacks at the WTO. More details here.
Recap: Need a refresher on the controversy surrounding India's sugar exports that has been raging for months? Read this article.
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