Focus on the Sugar Market

14-Sep-2026 12:06 PM

New Delhi. It is currently difficult to estimate actual production and market prices for the new marketing season—which formally begins in October 2026 and runs through September 2027—due to two main factors: uncertainty regarding weather and monsoon conditions, and the fact that the government has not yet announced its decision concerning the use of sugarcane juice and B-heavy molasses for ethanol production.

The 2025-26 marketing season was a mixed bag for the sugar industry. The industry faced difficulties early on due to subdued domestic market prices, though millers found some relief when prices surged to record highs in July and August. By September, however, the ex-factory price of sugar dropped back to near-normal levels.

The sugar industry faces several challenges in the upcoming marketing season. The intensity and strength of El Niño are increasing, and rainfall is likely to be deficient in September. Sugar stocks held by the industry are expected to shrink to their lowest levels in recent years.

Exports remain banned, and there is an apprehension that restrictions may be imposed on the use of sugarcane juice for ethanol production. The outlook for the 2026-27 season remains uncertain for the country's 540 sugar mills and 50 million sugarcane farmers, even as the government keeps a close watch on the sugar market.