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Informist, Wednesday, Jul. 29, 2026

By Afra Abubacker and Ritwika Dutta

MUMBAI – Ex-mill prices of sugar rose in major markets across Maharashtra Wednesday, as the sales quota for August fell short of market expectations. In addition, most mills in the state were not under pressure to offload their stocks and exhaust the July sales quota by the month-end, Mukesh Kuvadia, secretary of the Bombay Sugar Merchants Association, said. "Prices are up INR 40-INR 50 as August quota was lower-than-expected," Kuvadia said. He said prices are likely to remain firm on the upside.

The government announced Tuesday the sugar sales quota for August at 2.25 million tonnes, unchanged from a year earlier, but 2.3% higher than the 2.20 million tonnes allocated for July. The August quota was significantly lower than the market's expectation of 2.30 million-2.35 million tonnes, according to the average of six estimates polled by Informist. Some participants had expected the quota to be even higher, around 2.4 million tonnes, as the government has been wanting to improve supplies and check prices.

Over the past few weeks, ex-mill sugar prices have risen more than 15% on panic buying and speculation that supplies could tighten in the coming months. Tuesday, all-India average prices of sugar in retail markets were INR 48.96 per kilogram, up from INR 46.5 a month ago and INR 45.95 a year ago, data from the Department of Consumer Affairs showed. Meanwhile, the average wholesale rates were INR 4,537.4 per 100 kg, up from INR 4,330.4 a month ago and INR 4,270.2 a year ago.

The government Tuesday imposed a stock-holding limit on sugar dealers from Aug. 1 to Nov. 30 to improve supplies and check prices. As per the government notification, sugar dealers must sell all stocks within 30 days of purchase and cannot hold more than 400 tonnes at any given time.

Despite the recent government interventions, market participants expect sugar prices to rise. "Prices would rise, but haltingly, as trade is conscious of the government's playbook (to control prices)," agricultural markets and policy expert G.K. Sood said. Announcing weekly sales quotas for mills to prevent late-month offloading, imposing stock limits on trade to prevent hoarding, and importing sugar are some standard measures the government implements to check prices.

Amid speculation over stock availability, government officials are set to physically inspect sugar mills in the first two weeks of August and cross-verify their reported sales data against goods and services tax data for July. "By mid-August, the government would have data of physically verified stocks. September and October sales quotas would depend on these verified stocks," Sood said. 

Going ahead, mills are likely to wait and assess how demand plays out amid stock limits, Kuvadia said. Though the current stock limit of 400 tonnes is considered liberal for a wholesaler, the market is yet to gauge how buying sentiment will pan out across the next month. "It will get clear in some days, probably the first week of August," he said.

"Dealers in Mumbai markets typically do not hold more than 180-200 tonnes while dealers in northeast markets such as Kolkata and Assam hold around 2,650 tonnes because they are distant from major producing states," Rahil Shaikh, managing director, MEIR Commodities, said. He added that dealers in deficient markets should demand that state governments relax stock limits for efficient logistics.

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

--Up INR 40-INR 50 at INR 4,560-INR 4,600 per 100 kg in Kolhapur

--Up INR 40-INR 50 at INR 4,670-INR 4,732 per 100 kg in Mumbai

At 1902 IST, the price of sugar on the Intercontinental Exchange was up nearly 1% at 14.69 cents per pound.  End

US$1 = INR 95.64

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

Edited by Shubhayan Bhattacharya

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