What happened: sugar price rise and Government anti-hoarding + supply steps

The Ministry of Consumer Affairs, Food & Public Distribution reported that sugar prices increased in recent weeks, moving from ₹48.18 per kg on 20 July 2026 to ₹55.70 per kg on 20 August 2026. The Government stated that it is closely monitoring sugar stocks and market practices and has taken steps to ensure adequate availability of sugar and stable prices for consumers ahead of the festive season.

Background and earlier position: ethanol diversion, production expectations, and global pressure

The Government said the sugar price rise cannot be attributed to diversion of sugar for ethanol production. The Government stated that the share of sugar diverted for ethanol declined from around 12% in 2022-23 to around 9% in 2025-26, and that nearly three-fourths of ethanol production comes from grains, particularly maize.

On causes, the Government stated that multiple factors are contributing to the current price increase: lower-than-expected domestic production, increased demand ahead of the festive season, weather-related damage to the sugarcane crop, tightening global sugar supplies, and speculation and hoarding by some industry participants.

For domestic production during the current season, the Government expected sugar production to be around 306 LMT (against an initial estimate of around 343 LMT). The Government linked production damage to Red Rot and Top Borer disease in sugarcane and waterlogging caused by excess rainfall.

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