News Capsule: Weak Monsoon May Impact Sugarcane Output, Sugar Prices Likely to Rise
14-Apr-2026 11:12 AM
News Capsule: Weak Monsoon May Impact Sugarcane Output, Sugar Prices Likely to Rise
★ The India Meteorological Department (IMD) has forecast a weaker-than-normal southwest monsoon for 2026, with rainfall expected at only 92% of the Long Period Average (LPA) during June–September. There is also a 66% probability that rainfall will remain in the “deficient to below normal” range. If this forecast materialises, it would mark the weakest monsoon since 2015.
★ A weak monsoon could adversely affect sugarcane crops along with other kharif crops. After paddy, sugarcane is the second most water-intensive crop. Insufficient rainfall and water scarcity for irrigation may reduce sugarcane yields, raising concerns over lower sugar production in the upcoming season.
★ India’s sugar industry already operates under a tightly regulated framework, where the government determines sugarcane prices, sugar MSP, farmers’ cane dues, monthly sales quotas, export volumes, ethanol prices, and ethanol allocation. In such a scenario, weak monsoon conditions could alter the current market balance significantly.
★ If sugarcane production declines, sugar availability in the next crushing season may tighten, leading to a likely rise in sugar prices. This may improve revenues for sugar mills, but could also add inflationary pressure on consumers. With rising production risks due to poor rainfall, the sugar market is expected to remain highly sensitive in the coming months.