Centre pushes for early sugarcane crushing as mills seek special subsidy
India has urged Maharashtra, Uttar Pradesh and Karnataka to begin 2026-27 sugar crushing early to curb prices amid a 30-40 lakh tonne surplus. Mills seek subsidies for early crushing losses, while the Centre approved 1 million tonnes of raw sugar imports and tightened trader stock limits.
New Delhi: The Centre is stepping up efforts to control sugar prices despite the country having an estimated 30-40 lakh tonnes of sugar surplus over domestic demand. The Union Food Ministry has urged Maharashtra, Uttar Pradesh and Karnataka to start the 2026-27 sugarcane crushing season early, but sugar mills have sought a special subsidy to offset losses arising from early crushing, Agrowon reported.
Ex-mill sugar prices had gradually climbed to around Rs 68 per kg, pushing retail prices to nearly Rs 80 per kg. The Centre subsequently introduced a series of measures to bring prices down, with ex-mill prices now declining to around Rs 41 per kg. However, the government continues to explore measures to bring prices down further.
India produced around 280 lakh tonnes of sugar last year and entered the season with stocks of nearly 50 lakh tonnes. With domestic consumption estimated at around 280 lakh tonnes, the country is expected to have around 35 lakh tonnes of sugar in stock by September 30. The Centre, however, wants fresh sugar to enter the market before existing stocks are depleted.
Maharashtra, Uttar Pradesh and Karnataka account for around 80% of India’s total sugar production. The Union Food Ministry has therefore written to the chief ministers of the three states, urging them to advance the 2026-27 crushing season.
Union Food and Public Distribution Secretary Sanjeev Chopra has also scheduled a meeting with the sugar industry in New Delhi on September 8. Secretaries of the three states have been invited to attend the meeting.
West Indian Sugar Mills Association (WISMA) president B. B. Thombre said the Centre was pressing for crushing to begin around mid-October. However, the availability of sugarcane harvesting labour remains a challenge, as workers generally arrive after Diwali. Mills traditionally begin crushing around November 15, but the industry is willing to explore starting operations between October 20 and 25 this year.
Thombre said early crushing could reduce sugar recovery at mills by around 1.5 percentage points and result in a 10-15% reduction in the weight of sugarcane received from farmers. He said the Centre should therefore provide special assistance for cane crushed between October 15 and November 15.
The industry plans to seek a special subsidy of Rs 500 per tonne for sugar mills and Rs 300 per tonne directly to sugarcane farmers at the September 8 meeting.
Meanwhile, the Centre has approved imports of one million tonnes of raw sugar and invited applications for the remaining quota after applications received initially covered only around eight lakh tonnes. The government has also reduced the permissible sugar stockholding limit for traders from 400 tonnes to 200 tonnes.
Despite these measures, sugar prices have not fallen as much as expected. Central agencies are now examining the sales made by sugar mills to traders to determine where stocks are being held.
The Centre had earlier sought details of sugar sold to traders between August 17 and 19, followed by data for August 21-25. It has now asked mills to submit complete details of sugar sales made between August 20 and 31 as part of its efforts to track stocks and contain prices.
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Source : ChiniMandi
