ISMA seeks MSP hike as rising costs and mounting inventories tighten cash flows
India’s sugar output reached 225.06 lakh tons as of February 15, 2026, up from 197.35 lakh tons last year, despite fewer operating mills, according to the Indian Sugar Mills Association. Higher production in Maharashtra and Karnataka boosted totals, while the industry seeks an MSP hike to ease rising cost pressures.
ISMA, in its sugar production report, said that as of February 15, 2026, sugar production has reached 225.06 lac tons, against 197.35 lac tons produced last year on the corresponding date. The number of operating factories was 456 this year, down from 460 on the corresponding date last year.
Uttar Pradesh has produced 66.27 lakh tons of sugar so far, marking an increase of 2.23 lakh tons (around 3%) over last year by mid of February. The state currently has 111 mills in operation, compared to 119 mills at the same time last year.
In Maharashtra and Karnataka, the total sugar production has reached 89.72 lac tons and 40.65 lac tons, respectively, higher than 68.22 lac tons and 35.80 lac tons produced last year, as of mid- Feb.
About 55 factories have collectively closed across both states so far, compared to 58 closures during the same period last year. It is worth noting that some factories in South Karnataka are expected to restart operations during the special season from June / July to September 2026.
The following table gives state-wise details of sugar production this year vis-à-vis last year:
| YTD | 15th Feb’2026 | 15th Feb’2025 | ||||||
| Number of Factories | Number of Factories | |||||||
| ZONE | Started | Closed | Operating | Sugar Production (Lac Tons) | Started | Closed | Operating | Sugar Production (Lac Tons) |
| U.P. | 120 | 9 | 111 | 66.27 | 122 | 3 | 119 | 64.04 |
| Maharashtra | 208 | 26 | 182 | 89.72 | 200 | 30 | 170 | 68.22 |
| Karnataka | 81 | 29 | 52 | 40.65 | 78 | 28 | 50 | 35.80 |
| Gujarat | 14 | 2 | 12 | 5.80 | 15 | 1 | 14 | 5.99 |
| Tamil Nadu | 30 | 3 | 27 | 2.72 | 30 | 4 | 26 | 2.34 |
| Others | 81 | 9 | 72 | 19.90 | 87 | 6 | 81 | 20.96 |
| ALL INDIA | 534 | 78 | 456 | 225.06 | 532 | 72 | 460 | 197.35 |
(Note: The above sugar production figures are after diversion of sugar into ethanol)
The Association said that it has procured satellite images of standing crop across the country, thereby giving a fair idea of the remaining harvestable cane area. Based on the detailed analysis of field conditions, satellite data, estimated yield and recovery so far, and expected yield and recovery for the balance season, ISMA will shortly release its Third Advance Estimate of sugar production for the current season 2025-26.
As the sugar season progresses and inventories continue to build up, the industry remains in anticipation of an early upward revision of the Minimum Selling Price (MSP) of sugar.
ISMA said that with production costs rising and ex-mill realisations not keeping pace, the widening gap has intensified cash-flow pressures across mills, contributing to an upward trend in cane payment arrears. A timely upward revision of MSP, aligned with current cost structures, would be instrumental in restoring financial viability, enabling mills to clear farmers’ dues promptly, and ensuring overall market stability—without entailing any additional fiscal burden on the Government.
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