Sugar prices have increased from ₹48.18 per kg on 20 July 2026 to ₹55.70 per kg on 20 August 2026 due to a combination of factors. The Government has taken measures to ensure adequate availability and prevent hoarding. Ethanol production is not the cause of the increase, as sugar diverted for ethanol has declined from around 12% in 2022-23 to around 9% in 2025-26.
Sugar prices in India have risen from ₹48.18 per kg on 20 July 2026 to ₹55.70 per kg on 20 August 2026. The Government is closely monitoring the situation and has taken a series of measures to ensure adequate availability of sugar and stable prices for consumers.
The rise in sugar prices cannot be attributed to ethanol production. In fact, the share of sugar diverted for ethanol has declined from around 12% in 2022-23 to around 9% in 2025-26. Nearly three-fourths of the ethanol produced in the country now comes from grains, particularly maize.
The present increase in sugar prices is due to a combination of factors, including lower-than-expected domestic production, increased demand ahead of the festive season, weather-related damage to the sugarcane crop, tightening global sugar supplies, and speculation and hoarding by some sections of the industry. Sugar production during the current season is expected to be around X compared to the initial estimate of around Y by sugarcane-growing States.
Production has been affected by Red Rot and Top Borer disease in sugarcane, as well as waterlogging caused by excess rainfall. Despite the lower than estimated production, adequate sugar stocks are available in the country to meet domestic demand until the new crushing season begins in October.
The tightening of sugar supplies is a global phenomenon, with the global sugar deficit for 2026-27 estimated at around Z. Concerns over weather conditions have further affected the global outlook. As a result, international sugar prices have risen sharply from $474 per tonne on 30 June 2026 to $552 per tonne on 20 August 2026 — an increase of over 16% in less than two months.
The Government has observed that speculation and hoarding by some sugar mills and traders have also contributed to the recent price increase. Several steps have therefore been taken, such as imposing a stock limit of 400 tonnes on sugar dealers across the country from 1 August to 30 November 2026, prohibiting bulk consumers from holding sugar stocks exceeding 15 days of consumption, and conducting physical verification of sugar stocks at mills to check hoarding and artificial scarcity. As a precautionary measure, the Government has decided to permit duty-free import of 10 LMT of raw sugar to further augment domestic availability.
States and sugar mills have been advised to begin crushing from A, which is expected to raise October sugar production from the usual 3-4 LMT to B, further improving availability during the festive season.
Source:
Press Information Bureau
