India set to ban sugar exports for first time in 7 years

After slapping 40 percent tax on onion exports with immediate effect, India is expected to ban mills from exporting sugar in the next season beginning October, Reuters reported. 

The move could halt sugar shipments from India for the first time in seven years, as a lack of rain has cut cane yields.

India's absence from the world market would be likely to increase benchmark prices in New York and London that are already trading around multi-year highs, triggering fears of further inflation on global food markets, according to Reuters.

"Our primary focus is to fulfil local sugar requirements and produce ethanol from surplus sugarcane," an Indian government source was quoted as saying. 

"For the upcoming season, we will not have enough sugar to allocate for export quotas."

India allowed mills to export only 6.1 million tonnes of sugar during the current season to Sept. 30, after letting them sell a record 11.1 million tonnes last season.

In 2016, India imposed a 20% tax on sugar exports to curb overseas sales.