9 hrs ago
Government Orders Sugar Mills to Report Data Amid Price Rise
The government is worried that sugar prices may rise during the festival season.
It has asked sugar mills to report how much sugar they make and sell each month.
Officials want enough sugar to be available in shops.
India has allowed duty-free imports of 1 million tonnes of sugar.
Applications have already been submitted for 0.8 million tonnes, mainly from Brazil.
The government says some producers may be holding sugar to encourage higher prices.
The sugar industry says traders and large buyers helped push prices up, but it says there is no shortage.
Sugar production has fallen while consumption has risen slightly.
From September, mills will have to release their allocated sugar in two stages each month.
The Food Ministry instructed sugar mills to submit accurate monthly production and sales data.
The government urged mills to maintain supplies during the festive season and prevent further price increases.
India has received applications to import 0.8 million tonnes under a duty-free quota of 1 million tonnes.
Average retail sugar prices reached Rs 60.2 per kilogram, while prices exceeded Rs 65 in some cities.
From September, mills must follow a fortnightly allocation system, selling 40% of supplies in the first week.
- Who
- The Food Ministry, sugar mills, sugar producers, traders and bulk consumers are involved.
- What
- The government is requiring monthly production and sales data while changing sugar allocation rules to improve supplies and control prices.
- Where
- India, with sugar imports planned from Brazil.
- When
- The instructions were announced on Thursday; the fortnightly allocation system begins in September during the 2026-27 sugar season.
- Why
- The measures aim to maintain festive-season supplies and stabilize prices after reduced production, high global prices and suspected hoarding or speculative buying.
Government assessment
Sugar industry assessment
Cause of price increases
Government assessment
The government attributed the rise partly to hoarding by producers, along with lower domestic production, festive demand and high global prices.
Sugar industry assessment
The industry said speculative buying by traders and bulk consumers, as well as lower-than-estimated production, caused the spike.
Availability of sugar
Government assessment
The government is seeking additional imports and tighter reporting and allocation rules to ensure adequate supplies.
Sugar industry assessment
The industry maintained that there is no sugar shortage despite the recent price increase.
Need for price controls
Government assessment
The government said there is no justification for a price rise during festivals and urged mills to help stabilize prices.
Sugar industry assessment
The industry characterized the increase as driven by short-term market factors and speculative activity rather than an underlying shortage.
Key facts
- Average retail price
- Rs 60.2 per kilogram on Thursday, up 39% year-on-year and 19% month-on-month.
- Urban prices
- Sugar prices have exceeded Rs 65 per kilogram across some urban centres.
- Duty-free import quota
- The government allowed imports of 1 million tonnes of sugar.
- Import applications
- Applications had been received for 0.8 million tonnes.
- 2025-26 production
- Sugar production was around 28.1 million tonnes, down 27% from 35.8 million tonnes in 2021-22.
- 2026-27 opening stock
- Projected opening stock is 3.5 million tonnes, described as the lowest in a decade.
- New allocation system
- From September, mills must sell at least 40% of their allocation in the first week and the remainder in the following week.
Quotes
Ashwini Srivastava
Joint secretary in India’s Department of Food and Public Distribution
“We have asked mills to provide accurate monthly production and sugar sale data, and it is the collective responsibility of the entire sector to ensure that prices remain stable. There is no justification for any price rise during festivals.”
financialexpress.com
Sources
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