News Capsule: Expectations of faster sugar exports, quota likely to be largely utilized
18-Dec-2025 12:10 PM
News Capsule: Expectations of faster sugar exports, quota likely to be largely utilized
★ Sugar exports from India in the 2025–26 season (October–September) are expected to pick up pace in the coming months. According to Ravi Gupta, ED of Shree Renuka Sugars, shipments are likely to increase from January, and the government will review quota utilization by March.
★ The government has allowed sugar exports of 1.5 million tons for this season. So far, around 0.23 million tons have been contracted. Most of these deals are recent, so actual shipments have only just begun. The industry expects a large part of the quota to be utilized, although a shortfall of 0.1–0.2 million tons is possible.
★ In 2025–26, India’s gross sugar production is estimated to rise by 16% to 34.35 million tons. Out of this, around 3.4–3.9 million tons of sugar/sucrose is expected to be diverted for ethanol. Domestic consumption is estimated at about 28.5 million tons, which will result in surplus stocks and make exports necessary.
★ Soft domestic prices and a weaker rupee are supporting exports.
★ The government may reallocate unused quota after March, which could accelerate exports during January–March.
★ The industry has highlighted the need to increase ethanol blending, provide incentives for flex-fuel vehicles, and review ethanol prices. It believes ethanol availability is adequate and that higher blending levels could increase demand.
★ Exports are crucial for managing surplus sugar.
★ The industry is confident that sugar exports close to 1.5 million tons are achievable in 2025–26.
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★ Sugar production has increased this year, and if exports provide support, prices may see some impact.
★ It is important to note that while no files have been moved yet on MSP, the share of sugar/sugarcane juice/molasses in ethanol has declined.
★ Reduced use of sugar in ethanol means sugar availability could remain comfortable.
★ When the government itself decides sugarcane prices, sugar prices, monthly sales under the quota, export volumes, ethanol volumes, ethanol prices, and timelines for farmer payments, it raises the question of how much control mills really have.