It is reported by S&P Global Platts.

India is currently experiencing a second wave of COVID-19 infections, with 403,738 new cases and 4,092 deaths reported on May 9, according to data from the World Health Organization.

Many state governments have announced the imposition of lockdown restrictions, including Maharashtra, Uttar Pradesh and Karnataka which are key production regions of sugar.

Although the agricultural sector is classified as an essential service permitted to continue with operations, there are growing concerns about the potential implications of labor shortages and logistical challenges.

Several sources familiar with the matter said that although exports from India are currently unaffected as ports are still operating, concerns of supply chain bottlenecks are brewing as there is a lack of truck availability caused by movement restrictions and labor shortages.

With the rising COVID-19 infections in India, the global shipping industry has taken a hit not only commercially but also operationally, such as crew replacement and potential quarantine requirement for ships where the last port of call was from Indian ports.

Market participants noted that with the lockdown and increasing severity of the pandemic situation in India, there is growing hesitancy amongst buyers about purchasing sugar of Indian origins for fear of escalating logistical constraints.

«Although India shipments are still ongoing right now and there is not a lot of delays, you never know, so it is quite risky to book something there. Especially because it looks like the COVID situation is getting worse», — said a Singapore-based trader.