Indian mills have signed contracts to export 1.2 million tonnes of sugar in the 2021/2022 marketing year that starts from Oct. 1 as a rally in global prices has made exports feasible without government subsidies, two leading trade bodies said on Thursday.

Exports from the world’s second biggest sugar producer could limit a rally in global prices that reached a 4-1/2-year high in August as traders started scaling down Brazil’s production estimates due to bad weather.

India could export 6 million tonnes of sugar in the coming marketing year as the global sugar deficit is set to worsen in the year because of lower production in Brazil, the Indian Sugar Mills Association (ISMA) said in a statement.

India could export a record 7 million tonnes in the 2020/2021 marketing year, banking on a government subsidy for overseas sales, ISMA said.

However, the All India Sugar Trade Association (AISTA), another trade body, said India could export 7.5 million tonnes in the current marketing year ending on Sept. 30 and that 6.96 million tonnes already have been dispatched.

The government has ruled out a subsidy for next season as global prices have jumped.

“Export subsidy is not required in the new season as global prices are trading around 19.5 cents per lb,” said Praful Vithalani, president of AISTA.

The government should quickly settle subsidy claims for the current season, which will help mills to start the crushing season on time, Vithalani said.

Brazil will start its new season from April, while new season supplies from Thailand are likely to become available only after January 2022, giving India an opportunity to export surplus sugar in the next few months, the ISMA said.

India could start the 2021/2022 marketing year with carry forward stock of 8.7 million tonnes and produce another 31 million tonnes in the season compared with local demand of around 26 million tonnes.