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Informist, Thursday, Jun. 26, 2025

By Afra Abubacker

NEW DELHI – Ex-mill sugar prices rose in key markets of Maharashtra after the Centre announced a lower sale quota for July, traders said. Prices were, however, largely steady in Uttar Pradesh, they said. The government has set the domestic sugar sales quota for July at 2.2 million tonnes, down 4.3% from a month ago and 8.3% from a year ago.

Sugar prices rose by INR 15 per 100 kg in Maharashtra, following the announcement of the sales quota. "The 22 lakh tonnes quota came at the lower end of market expectations," said Mukesh Kuvadia, secretary of the Bombay Sugar Merchants Association.

According to Kuvadia, millers in Maharashtra had expected the government to fix the quota at around 2.25 million tonnes–2.30 million tonnes. "There is no extension of the unsold June quota, and July has 31 days. Prices will rise some more," he said. Kuvadia expects ex-mill prices in Maharashtra to rise by another INR 10–15 in the first week of July, before stabilising. 

Several mills have requested the government to allow them to carry forward the unsold quota from June to July, but there are some industry voices against it. Though quota deviations are not unusual, the government had expected the June allocation to be largely met as it was lower than last year's 2.55 million tonnes. Sugar demand has slowed down due to the early arrival of monsoon and sluggish off-take from bulk buyers. Typically, sugar demand from soft drink makers and ice cream manufacturers declines with the fall in temperatures.

"Extension is neither fair nor equitable. It benefits speculators who choose not to sell, at the cost of those who complied with the government quota," said G.K. Sood, the chairman of MEIR Commodities. "The person who did not sell took a business decision. They did not like the prices and decided not to sell. It is no calamity," Sood added, hoping the government does not grant mills' requests for a rollover.

Meanwhile, sugar prices in Uttar Pradesh remained largely unchanged following the quota announcement, trader Naresh Gupta said. "The market was under some pressure before the government announced the July quota. Some millers had lowered prices by INR 20," Gupta noted. "But after the quota was announced, millers recouped those cuts, and the market has steadied overall."

Traders said that mills in Uttar Pradesh had more unsold quota from June compared to those in Maharashtra, which may have contributed to the muted price response in the northern region.

The following are the highlights of sugar prices in the domestic market:

--Flat at INR 3,820-INR 3,920 per 100 kg in west Uttar Pradesh

--Flat at INR 3,830-INR 3,925 per 100 kg in central Uttar Pradesh

--Up by INR 15 at INR 3,942-INR 4,060 per 100 kg in Mumbai

--Up by INR 15 at INR 3,820-INR 3,880 per 100 kg in Kolhapur

At 1647 IST, sugar prices on the Intercontinental Exchange were down 1.6% at 16.34 cents per pound. Prices fell due to expectations of higher global sugar output. Brazil's sugar production in 2025-26 is estimated to rise 2.3% to a record 44.7 million tonnes. Sugar production in India in 2025-26 is projected to rise 25% to 35.3 million tonnes due to a favourable monsoon and higher sugarcane acreage. Thailand's 2025-26 sugar production is expected to increase 2% to 10.3 million tonnes.  End

US$1 = INR 85.70

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Saji George Titus

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