MSP for Sugar Likely to Increase; Cooperative Sugar Mill Federation Writes to the Food Ministry
India’s sugar output for 2025–26 is forecast at 35 million tonnes, boosted by strong monsoons in Maharashtra and Karnataka, according to NFCSF. Of this, 4.5 million tonnes will be diverted for ethanol and 2 million tonnes exported. NFCSF has urged raising sugar’s MSP to ₹3,900/quintal to improve mill liquidity without affecting inflation.
In the upcoming sugar production year (2025-26), India’s sugar industry is expected to produce 35 million tonnes of sugar. The National Federation of Cooperative Sugar Factories (NFCSF) believes that good monsoon rains in Maharashtra and Karnataka will drive production to this level.
Prakash Naiknavare, Managing Director of NFCSF, told Rural Voice that prospects for sugar output across the country look positive, with Maharashtra and Karnataka expected to see the most significant increase. Alongside this, NFCSF has projected 4.5 million tonnes of sugar diversion for ethanol and 2 million tonnes of sugar exports.
Based on ex-factory sugar prices ranging between ₹3,860 and ₹4,070 per quintal, NFCSF has urged the Union Ministry of Food to raise the Minimum Selling Price (MSP) of sugar from the current ₹3,100 to ₹3,900 per quintal. In its letter to the ministry, the federation argued that such a revision would not impact inflation but would provide cooperative sugar mills with much-needed liquidity and bring price stability.
For the ongoing crushing season, sugar production is estimated at 26.11 million tonnes. In the special season, crushing continued till September in 18 sugar mills in Tamil Nadu and Karnataka. By September 15, production stood at 25.93 million tonnes, with an average recovery of 9.26% (after ethanol diversion). So far, 3.4 million tonnes of sugar has been diverted for ethanol. Out of the 1 million tonnes of export quota issued by the government, 770,000 tonnes had been shipped by September 15. Major importers of Indian sugar include Djibouti, Sri Lanka, Afghanistan, Somalia, Bangladesh, and the United Arab Emirates (UAE).
For the new season (2025-26), with an estimated 35 million tonnes of output, after accounting for 28.5 million tonnes of domestic consumption, 2 million tonnes of exports, and 4.5 million tonnes of diversion for ethanol, the closing stock is expected to be 5.33 million tonnes.
Under the Ethanol Blending Programme (EBP), during the current Ethanol Supply Year (ESY), 11.33 billion litres of ethanol had been allocated till August 31, of which 31% was sugar-based and 69% grain-based. With 8.40 billion litres of blending achieved, the blending level stood at 19.12%, including 2.95 billion litres supplied by the sugar industry. For the next season (2025-26), considering better sugar output, the government has allowed sugar mills to produce ethanol from cane juice, syrup, B-heavy molasses, and C-heavy molasses. The industry estimates that in the next Ethanol Supply Year (2025-26), 12 billion litres of ethanol will be allocated.
Naiknavare told Rural Voice that based on NFCSF’s letter seeking a hike in MSP, the federation expects a positive decision from the government. He added, “We have sought ₹3,900 per quintal as MSP, which is in line with current ex-factory prices. This will also enable cooperative sugar mills to access higher loans, as cooperative banks currently value stocks at ₹3,100 per quintal — a level that is no longer realistic.”
To Read more about Sugar Industry continue reading Agriinsite.com
Source : Rural Voice
