Sugar prices across India have increased significantly ahead of the festival season, driven by supply limitations and rising production costs, potentially impacting household budgets and government interventions.
Sugar prices across India have climbed sharply ahead of the festive season, adding to household pressure just as demand for sweets typically rises. TV9 Hindi reported that average retail prices are up about 8% over the past month, with some states seeing increases of as much as 15%, raising concerns that Diwali and other celebrations will become more expensive for consumers.
The squeeze is being driven largely by a tighter supply picture. According to TV9 Hindi, output this year is estimated at 280 lakh tonnes, below an earlier projection of 293 lakh tonnes, while domestic consumption is close to 280 lakh tonnes and about 8 lakh tonnes have already been exported. The report also said mills have brought forward the start of crushing by 10 to 15 days in an effort to get more sugar into the market sooner. In wholesale markets, prices have risen by as much as ₹400 a quintal in the past month.
Retail prices in major cities have moved up accordingly. TV9 Hindi said sugar in Delhi has risen from ₹45 a kilogram to ₹49, while in West Bengal it has increased from ₹49 to ₹55. In Chennai, prices have climbed from ₹46 to ₹53, in Mumbai from ₹46 to ₹52 and in Ranchi from ₹47 to ₹51. The report said the rise is being felt most acutely in eastern India.
The price spike may help sugar producers even as it complicates the government’s efforts to keep food inflation under control. TV9 Hindi said companies including Balrampur Chini, Dwarikesh Sugar, Shree Renuka Sugar and Dalmia Bharat Sugar could see improved margins. But higher sugar prices may also make it more attractive for mills to produce sugar rather than divert cane juice for ethanol, potentially affecting India’s ethanol blending programme. That concern comes against a backdrop of repeated government interventions: the Cabinet raised the fair and remunerative price for sugarcane to ₹315 a quintal for the 2023-24 season, and officials have previously used export limits, stock controls and extra domestic allocations to steady prices during festival periods, according to reporting by Telegraph India, The New Indian Express, NDTV and Fortune India.
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