Indian sugar mills signed contracts to export 550,000 tonnes of the sweetener in recent days, as surging global prices and a weak rupee made overseas sales lucrative, four dealers told Reuters.

Higher exports from the world’s second-biggest sugar producer could check the rally in global prices , which have been buoyed by a spike in crude oil prices and lower output in top exporter Brazil.

The shipments will also help India reduce its stockpile and support the local prices of the sweetener, crucial in ensuring millions of cane farmers get government-mandated prices.

“In the past few days, mills from Maharashtra and Karnataka were active in the market. They were getting better realisation from exports than local sales,” said Rahil Shaikh, managing director of MEIR Commodities India.

Indian mills have so far signed contracts to export 6.4 million tonnes of sugar in 2021/22, dealers estimate. Out of this, nearly 5 million tonnes have already been shipped.

In the last few days, Indian traders mainly sold raw sugar to Asian buyers such as Indonesia and Bangladesh, which were trying to replenish their inventories ahead of the Muslim holy month of Ramadan, said a Mumbai-based trader with a global trading firm.

India had exported a record 7.2 million tonnes of sugar in the previous season, taking advantage of government subsidy for overseas sales.

But this year, mills could export 7.5 million to 8 million tonnes without government incentives, said a New Delhi-based dealer with a global trading firm.

“Rupee and global prices are supportive. If the government does not impose any restrictions on exports fearing inflation, then exports could rise to 8 million tonnes,” the dealer said.

The rupee depreciated to a record low this week, increasing traders’ margin from overseas sales.

Local sugar prices could have fallen sharply because of the record output but the export demand is supporting, said the Mumbai-based dealer.

India is likely to produce a record 33.3 million tonnes of sugar in 2021/22, nearly 7% more than a year ago.