NEW DELHI: The government has imposed a stock limit on sugar for bulk consumers, including confectionery makers, soft drink manufacturers, food processing industries, sweetmeat sellers and other institutional buyers. These consumers can hold a maximum of 10 tonnes of sugar for 15 days.The stock limit will be from September 1 to November 30.The price surge also comes amid growing focus on the diversion of sugarcane towards ethanol production under the government’s E20 programme. The government is looking at reducing the amount of sugarcane diverted for ethanol in the sugar season beginning October, which could leave more cane available for sugar production and help ease domestic prices. India has increasingly used sugarcane and its by-products for ethanol as it pushes towards 20 per cent ethanol blending in petrol.The latest consideration to increase sugar availability comes after wholesale sugar prices in Maharashtra rose nearly 20 per cent in August to a record Rs 5,350 per 100 kg, despite government assessments that overall domestic supplies remain sufficient until the next sugar season begins.Also read: Why India is considering sugar imports as prices hit record levels
Sugar prices surge
The all-India average ex-mill sugar price touched an all-time high of Rs 5,400-5,500 a quintal earlier this week, up sharply from Rs 3,900 a quintal a year ago, according to an industry body. This represents a rise of around 38-41% over the past year, as concerns over tighter supplies ahead of the new sugar season pushed prices higher.The increase has also filtered through to retail markets. The average all-India retail price of sugar rose 13% to Rs 52.30 per kg on August 18, from Rs 46.34 a kg a year earlier, according to consumer affairs ministry data.The latest surge comes as the industry expects the 2026-27 sugar season, beginning October 1, to start with a lower opening stock. Industry estimates put the carry-forward stock at 40-42 lakh tonnes, while some researchers estimate it could be as low as 32-35 lakh tonnes, against an estimated domestic requirement of around 50 lakh tonnes.The current season had started with an opening stock of 47 lakh tonnes on October 1, 2025. Based on estimated production of 280 lakh tonnes and exports of 7 lakh tonnes, total sugar availability for 2025-26 is estimated at around 320 lakh tonnes, against domestic consumption of 285 lakh tonnes. This would leave a closing stock of about 35 lakh tonnes, adding to concerns over availability at the start of the next season.
