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Informist, Thursday, Aug. 20, 2026

 

By Afra Abubacker

 

NEW DELHI – Despite the government mandating that bulk buyers can hold inventory of only 15 days, ex-mill sugar prices rose sharply in many markets Thursday amid strong festival season demand. In addition, mills continued to quote higher rates as they have more than 10 days left to exhaust their August sales quota, traders said. 

 

Late Wednesday, the government mandated bulk consumers such as confectioners, soft-drink manufacturers, food processors, and sweet sellers not to hold inventories for more than 15 days to prevent panic buying and hoarding sugar during the festival season. The inventory holding limit applies only to big consumers who buy more than 10 tonnes of sugar a month.

 

The inventory holding limit order is effective from Sept. 1 to Nov. 30, or throughout the peak festival season. Festivals such as Ganesh Chaturthi and Krishna Janmashtami fall in September. Demand is expected to peak ahead of Navaratri, Durga Puja, Dussehra, and others in October, followed by Diwali in November. Other festivals such as Chhath Puja and Guru Nanak Jayanti also fall during the month. 

 

Asked if the inventory holding limits are restrictive, market participants said they are quite tight as bulk consumers usually hold a 30-day stock to ensure smooth production. "Big players like cool drink manufacturers hold high inventories...they might be holding inventories as per their production planning," Mukukesh Kuvadia, secretary of the Bombay Sugar Merchants Association, said. He added that some companies might hold it for 30 days, others for 10 days. 

 

However, despite the recent government intervention, sugar prices rose sharply in many key markets Thursday. In Maharashtra, prices rose sharply by INR 200 in Mumbai and Kolhapur markets, Kuvadia said. However, in Uttar Pradesh, prices were relatively steady, rising only INR 20 on the higher side, Naresh Gupta, a north India-based trader, said. 

 

Traders said sugar prices are likely to rise further in the coming weeks as bulk buyers increase purchases to meet increased demand for sweets and confectionery products during the festival season. Even at the current elevated prices, sugar remains a cheap sweetener for confectionery and cool-drink manufacturers. Other sweetener substitutes such as milk solids, fruit extracts, and stevia are costlier. Market participants said sugar demand would weaken only when sugar prices are at par with other substitutes. 

 

Over the past few days, southern markets, particularly Karnataka and Tamil Nadu, have seen sharper upward moves of around INR 200-INR 350 per 100 kg. "Some markets were ruling slightly below others, and they are now catching up slowly," Gupta said. He added that Uttar Pradesh and Maharashtra markets are rising steadily almost every day, while other markets are catching up with some delay. 

 

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

--Up INR 200 at INR 5,980-INR 6,012 per 100 kg in Mumbai

--Up INR 200 at INR 5,800-INR 5,900 per 100 kg in Kolhapur

--Up INR 20-INR 90 at INR 5,650-INR 5,870 per 100 kg in Uttar Pradesh

--Up INR 300 at INR 5,700-INR 5,800 per 100 kg in Karnataka

--Up INR 200-INR 280 at INR 5,450-INR 5,550 per 100 kg in Gujarat

--Up INR 100-INR 200 at INR 5,600-INR 5,675 per 100 kg in Tamil Nadu

 

At 1741 IST, sugar prices on the Intercontinental Exchange were up 0.7% at 17.68 cents per pound.  End

 

US$1 = INR 95.71

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

 

Edited by Avishek Dutta

 

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