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Informist, Friday, Jul. 10, 2026

 

By Afra Abubacker

 

MUMBAI – Ex-mill sugar prices remained largely steady on Friday in the major markets of Maharashtra and Uttar Pradesh. Following the recent surge in prices, the government imposed stringent rules on sugar mills to reduce their stock holding and ensure adequate availability of the sweetener in the market.

 

"Before, mills could sell less than 90% of sales quota...But now, they tightened the stock limit, and mills must sell at least 90% of quota," Naresh Gupta, a trader based in north India, said. Until Thursday, mills were not penalised if they had failed to sell at least 90% of their quota, provided they informed the food department by 20th of the month. The government has now removed that provision, mandating mills to meet at least 90% of their sales quota. 

 

Sugar prices have firmed up since late June as a rainfall deficit during the ongoing monsoon season has added a weather premium to rates. In addition, anticipation of stocks tightening in the coming months also lifted prices. 

 

Gupta said the government is cautiously trying to ensure adequate sugar supplies till the next season's arrivals hit markets. The ongoing sugar season 2025-26 (Oct-Sep) is expected to close with stocks of 3.5 million tonnes, significantly below last year's 5.0 million tonnes. Typically, the sugar market considers 5.0 million tonnes a "comfortable" closing stock, as new-season sugar supplies will only pick up pace around November. 

 

"The government has realised that the market needs more supplies as prices were rising," G.K. Sood, agricultural markets and policy expert, said. "But as it is, the industry was selling more than quota because demand is typically higher than sales quota," Sood said, adding that some individual mills may be dispatching less. 

 

"Accordingly, all sugar mills are informed that if any group/individual sugar mill dispatches less than 90% of quota for a particular month, the release quota for the corresponding month will be restricted up to the percentage of utilisation of quota in the base month," the letter on Thursday said. 

 

Sood said mills could earlier inform the government that they were unable to sell as mandated by the government due to weak market demand. The government has now removed that provision, effectively allowing mills to default on only 10% of their sales limit. The government fixes the maximum quantity of sugar available for sale every month to ensure supply, support prices, and help mills clear the arrears of sugarcane farmers. 

 

There was no price correction in major sugar markets following the order, traders said. "Ex-mill rates are largely flat. Resale market was slow," Gupta said. Ex-mill rates refer to primary sales from sugar mills, while resale sugar rates refer to secondary sales between trading houses, distributors, and bulk buyers. 

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

--Flat at INR 4,230-INR 4,330 per 100 kg in western Uttar Pradesh

--Flat at INR 4,230-INR 4,350 per 100 kg in central Uttar Pradesh

--Flat at INR 10-INR 20 at INR 4,200-INR 4,260 per 100 kg in Kolhapur

--Flat at INR 10-INR 20 at INR 4,296-INR 4,380 per 100 kg in Mumbai

 

At 1854 IST, the price of sugar on the Intercontinental Exchange was down 1.7% at 14.86 cents per pound.  End 

 

US$1 = INR 95.33

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

 

Edited by Avishek Dutta

 

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