Low Sugar Stock with Mills May Trigger Supply Crisis
02-Aug-2025 12:43 PM
New Delhi. The Union Food Ministry, while issuing a free sale quota of 22.50 lakh tonnes of sugar to sugar factories for domestic sale in the month of August, had said in a notification that on July 31, 2025, the indigenous industry had a total stock of 90.58 lakh tonnes of sugar.
After the quota of 22.50 lakh tonnes is exhausted, the industry will be left with a stock of about 68 lakh tonnes of sugar at the end of August and then when the quota for September arrives, the outstanding stock will be reduced to less than 50 lakh tonnes.
The demand and consumption of sugar continues during the festive season. To meet it, the government has to issue more quota of sugar. Last year, the government had fixed a free sale quota of 22 lakh tonnes for August and 23.50 lakh tonnes for September.
This time the quota for August has been fixed 50 thousand tonnes more than that. Even if the quota for September 2025 is fixed equal to that of September 2024, the sugar stock with the industry will reduce to around 46 lakh tonnes on 30 September 2025. This also includes the stock of 1-2 lakh tonnes of sugar produced during the special session in Karnataka and Tamil Nadu during August-September.
At the end of last year's marketing season i.e. on 30 September 2024, the indigenous industry had a huge outstanding stock of about 79 lakh tonnes of sugar, whereas in the current marketing season of 2024-25, domestic production of sugar has been estimated at 261 lakh tonnes which is 58 lakh tonnes or 18 per cent less than the production of 319 lakh tonnes in the 2023-24 season.
Domestic consumption is likely to be around 280 lakh tonnes while permission for export of 10 lakh tonnes of sugar has already been given in January 2025.
On 30 June 2025, the industry had a stock of 112 lakh tonnes of sugar, while after the release of free sale quota of 22 lakh tonnes for July, the stock remained at 90.58 lakh tonnes at the end of the month.
This clearly indicates that almost the entire sugar stock of the quota fixed for the month of July has been sold. Due to the demand of Rakshabandhan, stockists had made good purchases of sugar.
If the crushing of sugarcane does not start early in October, then there may be a crisis of sugar supply. It will be necessary to see what the level of production remains in October and November.