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Informist, Monday, Aug. 31, 2026

NEW DELHI – The government has directed sugar mills across the country to sell 1.3 million tonnes by Sept. 15, the Department of Food and Public Distribution said in a post on social media platform X Sunday. This is the first sugar sales quota the government had announced after replacing the monthly sales quota system with fortnightly quotas. In September 2025, the sales quota was set at 2.35 million tonnes, and for August 2026 it was 2.25 million tonnes.

Under the fortnightly quota system, mills must sell at least 40% of the allocation in the first week and the rest in the succeeding week. This will ensure mills sell adequate sugar throughout the month and help keep prices in check.

Market participants had expected the government to announce the sales quota for the entire month along with the fortnightly details. The September sales quota was expected to be around 2.25 million tonnes-2.30 million tonnes, according to the average of five estimates polled by Informist. Some, however, expected the September sales quota to be higher, around 2.40 million tonnes. Apart from sugar mills releasing stocks, the market expects some 200,000 tonnes of sugar to come from port-based refineries in September. 

Sugar demand in September is estimated at 2.5 million tonnes-2.6 million tonnes amid festival-related demand and higher purchases to build up pipeline stocks, according to market participants. Amid the stockholding limits and other regulations, traders and bulk users have mostly cleared out their stocks. In August, the government mandated traders not to hold more than 400 tonnes of sugar at a time and to dispatch all stocks within 30 days of purchase.

In addition, police teams have been conducting raids in wholesale markets, particularly in the northern markets and in Kolkata, prompting traders to buy only for immediate needs. Though these limits have disrupted trading activities and weakened market sentiment, experts see the trade reviving sooner or later because of strong festival-related demand.

Bulk users also cannot hold more than 15 days' inventory for the next three months starting September. This applies to large consumers such as confectioners, soft-drink manufacturers, food-processing industries, and other institutional buyers with an average monthly sugar consumption of at least 10 tonnes. 

Typically, September sees strong demand from confectioneries, soft-drink manufacturers, and food-processing industries to cater to festival season demand through November. The introduction of fortnightly sales quota comes after the government intervened actively in the sugar market over the past weeks, including permitting duty-free imports of raw sugar, to cool the record-high prices.  End

Reported by Afra Abubacker

Edited by Himanshi Gupta

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