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Informist, Monday, Aug. 17, 2026

 

By Afra Abubacker

 

NEW DELHI – Despite recent government interventions to check prices, ex-mill rates of sugar surged Monday across major markets as mills quoted higher prices amid strong festival-season demand. In addition, increased speculation over sugar stock availability in the coming months prompted panic buying in the market. Traders said mills are likely to keep quoting higher rates in the coming weeks.

 

"Mills are increasing prices in the face of good demand. And they are selling in small doses," G.K. Sood, agricultural policy and markets expert, said. "August festivals started with the Kawad Yatra, and now Raksha Bandhan, Id (Id-e-Milad-un-Nabi) are coming. As you go along, there will be more like Janmashtami and others," he said, adding that sugar demand is "not price-elastic" and will not weaken materially even at the current higher prices.

 

Friday, the government mandated that mills deliver stocks within seven days of sale to dealers or bulk consumers to improve supplies and prevent artificial scarcity in the market. In July, it imposed a stockholding limit on traders for four months starting August. Despite these interventions, sugar prices continue to rise because of increased speculative buying. Concern about deficient rainfall has also added a weather premium to prices. 

In Maharashtra markets, sugar prices rose INR 50-INR 60 Monday, Mukesh Kuvadia, secretary of the Bombay Sugar Merchants Association, said. Tuesday, the sugar market in Maharashtra will open INR 100-INR 150 higher, as many mills have further raised rates, he added.
 

"In the last 10 days, sugar prices have risen more than INR 300-INR 400 per 100 kilograms," Kuvadia said, adding that he can't really make sense of the recent rally. Since June, ex-mill prices of sugar have been surging, with intermittent corrections, amid limited supply and concern over stocks tightening further in the coming months. 

 

Though experts agree that sugar stocks are tight, they say the rally is largely driven by speculation. "Whenever the government brings in new mandates and notifications (to improve supplies), the next day we see prices rising sharply," an industry official said. He added that these interventions signal a supply "crisis" and create panic in the market.

 

According to Sood, the rally was primarily triggered when industry bodies assured they would try to advance crushing operations. "In (recent) memory, associations have not assured the government and market that they will advance crushing," he said. "This has signalled a shortage to the market." Major industry associations such as the Indian Sugar & Bio-energy Manufacturers Association and the National Federation of Cooperative Sugar Factories told the government in July that sugar mills have agreed to commence the 2026–27 sugar season at the earliest possible date, based on prevailing agro-climatic conditions.

 

"Market is anticipating that there will be no sugar (availability) by November," Naresh Gupta, a trader based in north India, said. Though the sugar season runs from October to September, mills do not crush sugarcane round the year as cane availability is seasonal and tapers by March or April. "Mills will only start crushing for next season in November after Diwali," Gupta said, adding that harvesting labour will only be available after the Diwali celebrations. 

 

Traders feel sugar prices are likely to remain firm till November amid supply concerns and festival-season demand. "Those who need sugar will buy at higher rates. Sugar is an essential commodity, and there is no easy replacement for it," Kuvadia said.

 

Following are the ex-mill prices of sugar in the domestic market:

--Up INR 50-INR 60 at INR 5,132-INR 5,222 per 100 kg in Mumbai

--Up INR 50-INR 60 at INR 4,950-INR 5,000 per 100 kg in Kolhapur

--Up INR 70-INR 140 at INR 4,890-INR 5,050 per 100 kg in Uttar Pradesh

--Up INR 140-INR 190 at INR 4,880-INR 5,000 per 100 kg in Karnataka

--Up INR 60-INR 80 at INR 4,870-INR 4,900 per 100 kg in Gujarat

--Up INR 250 at INR 4,975-INR 5,100 per 100 kg in Tamil Nadu

 

At 2001 IST, the price of sugar on the Intercontinental Exchange was up 0.5% at 16.68 cents per pound.  End

 

US$1 = INR 95.60

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

 

Edited by Rajeev Pai

 

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