Export Import Newsletter 20th December 2021

India’s merchandise exports jumped 27.16% to USD 30.04 billion in November on the back of good performance by sectors like petroleum products, engineering goods and electronic items. The exports stood at USD 23.62 billion in November 2020. Imports in November were at USD 52.94 billion, showing an increase of 56.58% over inbound shipments of USD 33.81 billion in the year-ago month. As per the data released by the Ministry of Commerce and Industry, the November trade deficit stood at USD 22.91 billion. This compares with USD 10.19 billion in November 2020. Exports of petroleum products during November climbed 154.22% at USD 3.95 billion on a yearly basis. Outward shipments of engineering goods rose to nearly USD 8 billion, up about 37% over the same month last year.

The rise in India’s exports could be attributed largely to the continued growth momentum in advanced economies and the resultant increase in global import demand, along with favorable global commodity prices. Total merchandise exports may continue to cross the USD 100 billion mark for the second quarter in a row, and could amount to USD 105.8 billion in October-December 2021 (Q3FY22), up from USD 75.8 billion in Q3FY21. We discuss some of the latest updates in Indian trade below:

India could export six million tonnes sugar despite WTO ruling: Trade officials (Source)

India could sell more than six million tonnes of sugar on the world market this year with a World Trade Organization ruling that it flouted the rules by offering export subsidies unlikely to have an impact on overseas sales. Robust sugar exports from the world’s second biggest producer could keep a lid on global prices, which are currently trading near their highest level in 4-1/2 years because of lower output in top producer Brazil. For the current 2021/22 marketing year, India dropped an export subsidy in place for the last three years. The subsidy helped Indian mills to export a record 7.2 million tonnes of sugar in the 2020/21 season.

India’s rice exports to surpass FY21’s record 17.72 million tonne (Source)

The government said that India’s rice exports in 2021-22 would likely surpass the record 17.72 million tonne achieved in 2020-21. In the first seven months of the current fiscal, India’s rice exports rose by more than 33% to 11.79 MT from 8.91 MT achieved in April-October FY21. As per an official statement, non-Basmati rice exports have risen steeply and likely to more than double in volume terms over FY19. In 2020-21, India’s rice exports (Basmati and Non-Basmati) rose 87% to 17.72 MT from 9.49 MT achieved in 2019-20. Non-Basmati rice exports were USD 4.8 billion while Basmati Rice exports were USD 4 billion in FY21. Saudi Arabia, Iran, Iraq, Yemen, United Arab Emirates, United States of America, Kuwait, United Kingdom, Qatar and Oman have a share of close to 80% in total shipments of aromatic long grained rice from India.

MSME exports drop for two years in a row, exporters positive on outlook (Source)

Exports by small businesses started declining before the pandemic due to a stagnation in manufacturing and a global slowdown and worsened after the Covid-19 outbreak. However, exporters are optimistic about exports growing in the current financial year provided the new variant of the coronavirus isn’t disruptive. Micro, small and medium enterprises (MSMEs) shipped out goods worth USD 155.91 billion in FY20, which was 1.8% lower than USD158.76 billion a year earlier. MSME exports dropped 7.64% to USD 143.99 billion in FY21 due to the pandemic. India exported MSME products worth USD 90.8 billion in the first half of this financial year.

India’s November oilmeal exports down 51%; soybean meal export unlikely next 2-3 months (Source)

The country’s oilmeal exports declined by 51% to 1.62 lakh tons in November of this year due to sluggish export of soybean meal, industry body SEA said on Friday. Since India is currently outpriced for soybean meal export as compared with other countries like Brazil and Argentina, the country is unlikely to undertake shipments in the next two-three months, it said in a statement. The country had exported 3.32 lakh tons of oilmeal in the same month previous year. Oil Meals are used as animal feed in poultry and other sectors.

According to the latest data released by the Solvent Extractors’ Association (SEA), export of soybean meal declined to 42,383 tons in November of this year from 1,98,776 tons in the year-ago period.

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