Increased Sugar Production Puts Pressure on Prices

17-Dec-2025 09:28 PM

New Delhi: Domestic sugar production is witnessing a significant increase during the current marketing season compared to last year.

Sugar mills are receiving sufficient raw material (sugarcane), leading to a rapid crushing pace, and the average sugar recovery rate from sugarcane is also improving. ISMA has projected domestic sugar production to increase from 261 lakh tonnes in the 2024-25 season to 309 lakh tonnes in the 2025-26 season. The cooperative sugar mills' organization, MFCSF, has a similar estimate.

The prospect of robust production is putting pressure on ex-factory sugar prices. In Maharashtra, prices have fallen to Rs 3600-3660 per quintal, which is even below the cost of production. In light of this, ISMA is strongly urging the government to increase the minimum support price (MSP) for ex-factory sugar, otherwise,

sugar mills may face significant difficulties in paying farmers for sugarcane on time. MFCSF is also emphasizing the need to increase the sugar MSP.

Although the government has allowed the industry to export 15 lakh tonnes of sugar to prevent a massive stock buildup and maintain cash flow, the industry says this alone is not enough to alleviate the financial crisis.

The minimum ex-factory selling price of sugar has not been increased for the last five to six years, while sugarcane prices have continuously risen during this period.